August A Soft Month For The Bulk Of The Economy

August was a soft month for the bulk of the economy, a monthly dip that is now confirmed by the national activity index which fell to minus 0.55 from July's revised plus 0.24. All four main components posted monthly declines and all four are in the negative column. Production-related indicators, after a brief pop higher into the plus column in July, pulled the index down 0.33 in the month. The decline here largely reflects broad weakness in the August production industrial report. Employment-related indicators came in at minus 0.09 followed by personal consumption & housing, at minus 0.08, and sales, orders & inventories at minus 0.05. What indications we have for September are limited but do include this morning's dip in jobless claims which is a positive indication for the month's employment component.

Recent History Of This Indicator:
Major gains for industrial production and a strong employment report gave the national activity index a lift in July to plus 0.27 in what, however, has been a flat trend with the 3-month average at minus 0.10. Economic strength is expected through the second half of the year which points to gains ahead for this index.