The three-month average of the Chicago Fed National Activity Index (CFNAI) is expected to tick higher in tomorrow’s June report, based on The Capital Spectator’s average point forecast for several econometric estimates. The average projection for -0.17 reflects a moderate improvement over the previous month. The forecast for June continues to anticipate that US economic growth is running below the historical trend rate for expansion. But the projection also points to a 3-month CFNAI reading that’s well above the level that marks a new NBER-defined recession.
Only values below -0.70 signal an “increasing likelihood” that a recession has started, according to guidelines from the Chicago Fed. Using today’s average estimate for June as a guide, CFNAI’s three-month average is expected to reaffirm an expansion that’s moderately below the historical trend but well above the tipping point that equates with contraction.
Here’s a closer look at the numbers, followed by brief definitions of the methodologies behind The Capital Spectator’s projections that are used to calculate the average forecast:
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