January 2020 Chemical Activity Barometer Little Changed And Continues In Contraction

from the American Chemistry Council

The Chemical Activity Barometer (CAB) jumped 0.6 percent in January on a three-month moving average (3MMA) basis following a 0.1 percent gain in December. On a year-over-year (Y/Y) basis, the barometer rose 1.4 percent.

The unadjusted January data showed a 1.0 percent gain following a 0.5 percent increase in December and a 0.4 percent gain in November. The diffusion index rose to 62 percent in January. The diffusion index marks the number of positive contributors relative to the total number of indicators monitored. The CAB reading for December was revised upward by 0.33 points and that for November was revised downward by 0.22 points.

The Chemical Activity Barometer has four primary components, each consisting of a variety of indicators: 1) production; 2) equity prices; 3) product prices; and 4) inventories and other indicators.

Production-related indicators swelled in January. Trends in construction-related resins, pigments, and related performance chemistry improved, suggesting further gains in housing. Plastic resins used in packaging and for consumer and institutional applications were mixed. Performance chemistry improved, while U.S. exports were weak. Equity prices rose, while product and input prices were mixed. Inventory and other indicators were mixed. eased, reflecting weakness among industrial end-use markets. U.S. exports were weak. Equity prices rose sharply again this month, while product and input prices were mixed. Inventory and other indicators were mixed.

Per Kevin Swift, chief economist at ACC:

The CAB signals gains in U.S. commerce into the third quarter of 2020.


Caveats on the Chemical Activity Barometer (CAB):

The CAB is designed and prepared in compliance with ACC's Antitrust Guidelines and FTC Safe Harbor Guidelines; does not use company-specific price information as input data, and data is aggregated such that company-specific and product-specific data cannot be determined.

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