The Chicago Fed National Activity Index (CFNAI) ticked down to a reading of –0.44 in March from a –0.38 reading in February. While this is a regional Fed report, it is a measurement of national activity rather than the typical regional manufacturing reports. This is rarely a significant market-moving report.

Three of the four broad categories of indicators that make up the index decreased from February, contributing to a broader drop into negative territory. The CFNAI also showed that all four categories made non-positive contributions to the index in March.

The index’s three-month moving average fell to –0.18 in March from –0.11 in February, suggesting that growth in national economic activity was somewhat below its historical trend. The economic growth reflected in this level suggests subdued inflationary pressure from economic activity over the coming year.

The CFNAI Diffusion Index fell to –0.23 in March from –0.12 in February. Of the positive and negative factors, only 27 of the 85 individual indicators made positive contributions to the CFNAI in March, while 58 of the 85 indicators made negative contributions. Some 42 indicators improved from February to March, while 42 indicators deteriorated and one was unchanged. Of the indicators that improved, 21 made negative contributions.

Investors, economists and market watchers will want to consider that the monthly CFNAI is a weighted average of 85 existing monthly indicators of national economic activity. It was constructed to have an average value of zero and a standard deviation of one. A positive index reading corresponds to growth above trend, while a negative reading corresponds to growth below trend.