8:30a Chicago Fed National Activity Index
Level -0.15 actual vs -0.29 prior
3 Month Moving Average -0.24 actual vs -0.18 prior
Highlights
Consumer spending & housing remain in the negative column as do production and employment. Yet against a very weak minus 0.31 in February, the national activity index did move higher, to minus 0.15 in March. Negative scores at these levels indicate that growth in the month was below the historical average.
Personal consumption & housing pulled the index down by 0.07 in March which is 1 tick weaker than February's minus 0.06. Production-related indicators came in at minus 0.10 points in the month vs a negative contribution of 0.12 in February, reflecting the manufacturing component of the industrial production report which came in at minus 0.1 percent vs February's minus 0.3 percent. Employment improved to minus 0.03 from minus 0.15 in February when nonfarm payrolls managed only a 33,000 gain. The sales, orders, and inventories category made a contribution of plus 0.05 to March, up slightly from plus 0.01 in February.
Definition
The Chicago Fed National Activity Index (CFNAI) is a monthly index that tracks overall economic activity and inflationary pressures. The CFNAI is a weighted average of 85 existing monthly indicators of national economic activity. It is constructed to have an average value of zero and a standard deviation of one. Since economic activity tends toward trend growth over time, a positive index reading corresponds to growth above trend and a negative index reading corresponds to growth below trend. Why Investors Care
10:00a Existing Home Sales
Existing Home Sales - Level - SAAR Existing Home Sales - Level - SAAR 5.210M actual vs 5.480M (rev) prior
Existing Home Sales - M/M Change -4.9% actual vs 11.2% (rev) prior
Existing Home Sales - Yr/Yr Change -5.4% actual vs -2.3% (rev) prior
Highlights
After surging far beyond expectations in February, existing home sales came in at the low end of Econoday's consensus range in March. The 5.210 million rate is down a steep looking 4.9 percent on the month but compares with February's revised 11.2 percent jump.
Moving averages are important when gauging housing data because of their volatility and here the 3-month average, at 5.207 million, is up 1.4 percent on the month for the best showing since November. Still, home sales have been in a long slump with the current average comparing unfavorably with a 5.563 million peak back in December 2017.
A key positive in today's report is strength in selling prices, suggesting that sellers are holding firm to their asking prices. The median rose 3.7 percent in the month to $259,400 yet, in another indication of prior weakness, is up only 3.8 percent year-on-year.
Homes are coming into the market with supply rising 3.1 percent to 1.680 million. Relative to sales, supply is at 3.9 months which is still thin but up from 3.6 months in February.
In all regions, monthly sales slipped in the low-middle to high-middle single digits. Year-on-year, the West continues to trail at negative 10.7 percent. Total existing home sales in March were down 5.4 percent on the year.
When balancing March and February together improvement is clear, evident again by the quarterly pace of 5.210 million which is up from the fourth-quarter's 5.140 million. Like resales, new home sales have also been trending higher with housing in general getting a fundamental lift from the move lower in mortgage rates. Watch tomorrow for both the latest new home sales report and also an update from the FHFA on house prices.
Dan 
