WASHINGTON, April 21, 2015 /PRNewswire/ -- The Chemical
Activity Barometer (CAB), a leading economic indicator created by
the American Chemistry Council (ACC), was up 0.1 percent in April,
as measured on a three-month moving average (3MMA). Reaching an
index of 98.1, last seen in January
2008, the CAB remains up 2.6 percent over a year ago, and
suggests gains in business activity will continue into the fourth
quarter.
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. All components were up in April.
"All of the major production-related indicators are up and we
might continue to see a strengthening. Construction-related
chemistries have been adversely affected by bad weather so far this
year, but we expect an improvement as we get further into spring,"
said Kevin Swift, chief economist at
the American Chemistry Council. "The data on plastic resins and
polymers for packaging suggest that retail sales should continue to
be strong as well," Swift added.
The Chemical Activity Barometer is a leading economic indicator
derived from a composite index of chemical industry activity. The
chemical industry has been found to consistently lead the U.S.
economy's business cycle given its early position in the supply
chain, and this barometer can be used to determine turning points
and likely trends in the wider economy. Month-to-month movements
can be volatile so a three-month moving average of the barometer is
provided. This provides a more consistent and illustrative picture
of national economic trends.
Applying the CAB back to 1919, it has been shown to provide a
lead of two to 14 months, with an average lead of eight months at
cycle peaks as determined by the National Bureau of Economic
Research. The median lead was also eight months. At business cycle
troughs, the CAB leads by one to seven months, with an average lead
of four months. The median lead was three months. The CAB is
rebased to the average lead (in months) of an average 100 in the
base year (the year 2007 was used) of a reference time series. The
latter is the Federal Reserve's Industrial Production Index.
Chemical Activity Barometer for the Latest Six Months and
Year-Ago Month*
|
|
Apr-14
|
Nov-14
|
Dec-14
|
Jan-15
|
Feb-15
|
Mar-15
|
Apr-15
|
|
|
|
|
|
|
|
|
|
CAB (3
MMA)
|
95.5
|
97.6
|
97.5
|
97.8
|
97.9
|
98.0
|
98.1
|
% M/M
|
|
0.5
|
0.4
|
-0.1
|
0.3
|
0.1
|
0.0
|
0.1
|
% Y/Y
|
|
3.6
|
4.0
|
3.7
|
3.7
|
3.5
|
3.0
|
2.6
|
|
|
|
|
|
|
|
|
|
CAB
|
|
96.1
|
97.8
|
97.9
|
98.0
|
98.1
|
98.4
|
98.8
|
% M/M
|
|
0.5
|
0.3
|
0.1
|
0.0
|
0.1
|
0.3
|
0.4
|
% Y/Y
|
|
4.1
|
4.0
|
3.8
|
3.5
|
3.3
|
2.9
|
2.8
|
*Percentage changes may not reflect index values due to
rounding.
The CAB comprises indicators relating to the production of
chlorine and other alkalies, pigments, plastic resins and other
selected basic industrial chemicals; chemical company stock data;
hours worked in chemicals; publicly sourced, chemical price
information; end-use (or customer) industry sales-to-inventories;
and several broader leading economic measures (building permits and
new orders). Each month, ACC provides a barometer number, which
reflects activity data for the current month, as well as a
three-month moving average. The CAB was developed by the economics
department at the American Chemistry Council.
The next CAB is currently planned for:
26 May 2015
9:00 a.m. Eastern Time
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.
Note: Every effort has been made in the preparation of this
publication to provide the best available information. However,
neither the American Chemistry Council, nor any of its employees,
agents or other assigns makes any warranty, expressed or implied,
or assumes any liability or responsibility for any use, or the
results of such use, of any information or data disclosed in this
material.
www.americanchemistry.com
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SOURCE American Chemistry Council