The employment report for January looked strong as did retail sales, but the great bulk of economic indicators is still running slightly below historical trend. The national activity index came in at minus 0.05 in January with the 3-month average telling the same story, at minus 0.03.
Production is the weak link, coming in at minus 0.07 for January and getting very little lift from the manufacturing component. The personal consumption & housing component is also no help, pulled down by building permits for a minus 0.05 reading that offset retail sales gains. Employment is positive but at only plus 0.06 with the gain pulled down by January's 1 tick rise in the unemployment rate to 4.8 percent.
This index is a reminder that even an apparently strong month this cycle, like January, looks soft when compared against historical averages.