The Chemical Activity Barometer, the leading economic indicator created by the American Chemistry Council, rose 0.8% in November on a three-month moving average (3MMA) basis, following a 1% gain in October.
On a year-over-year (Y/Y) basis, the barometer fell 2.4% in November. The unadjusted data show a 1.3% increase in November, following a 0.5%% gain in October and 0.7% gain in September.
The CAB reading for October was revised upward by 0.38 points and the reading for September was revised downward by 0.06 points. “These were highly volatile months for the data,” ACC observed.
It also noted that the November data are provisional and subject to revision.
The CAB diffusion index eased from 76% to 71% in November. It marks the number of positive contributors among the total number of indicators.
“With seven straight months of gains, the November CAB reading is consistent with recovery in the U.S. economy,” said Kevin Swift, chief economist at ACC.
Applying the CAB back to 1912, it establishes a lead of two to 14 months, with an average lead of eight months at cycle peaks, to show where the economy is going.
CAB’s four main components, each consisting of a variety of indicators are: production; equity prices; product prices; and inventories and other indicators.
In November, production-related indicators were positive. Trends in construction-related resins, pigments and related performance chemistry were mixed. Resins and chemistry used in light vehicles and other durable goods were strong. Gains in plastic resins used in packaging and for consumer and institutional applications were positive.
Performance chemistry rebounded and U.S. exports were mixed. Equity prices rebounded and product and input prices were positive. Inventory and other supply chain indicators were positive., ACC said.