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Business Conditions Index Update 3/7/18

Business conditions continue to be favorable for sustaining THE GREAT BULL MARKET.
Ideal conditions prevail when the Aruoba-Diebold-Scott Business Conditions Index is ±1.

March 7, 2018 — The Federal Reserve Bank of Philadelphia’s Real-Time Data Research Center has updated the ADS business conditions index with information on initial jobless claims for the week ending 2/24/2018, real personal income less transfer payments for January 2018, and real manufacturing and trade sales for December 2017:How do we use the Business Conditions Index? We first want to see conditions to be about 0 for the index. Extremes always get our attention. If conditions become good for too long, it would be alerting us to a possibility the economy is benefiting from positive factors that usually prove to be unsustainable. Those conditions in the index include: 

  • Weekly initial jobless claims 
  • Monthly payroll employment 
  • Industrial production 
  • Personal income less transfer payments 
  • Manufacturing and trade sales 
  • Quarterly real GDP 

As you can see by the graph above, business conditions remain neutral. Please contact us with any questions.