Philly Fed → Industrial output

Where it stands now

Where the two indicators stand this issue

Philly Fed: Now 20.9. Industrial output: Median position across economies 61.

Tests

Does this link hold up?

1. Common explanationThe new orders and shipments that manufacturers report lead actual productionSource: Federal Reserve Bank of Dallas, “Regional Fed surveys give early insight into national economic indicators, but headline indexes not always most relevant” (2014). It compares five regional Fed surveys: the Philadelphia Fed index best predicted the national manufacturing purchasing managers’ index, while the Dallas Fed’s orders index best predicted industrial production.
2. Tested against our dataAgreement between the positions of Philly Fed and Industrial output (2-month lag), measured in the direction of the common explanation: +0.45. Looking at every 5-year period (shifted one year at a time), the two moved in that direction in all 10, but that does not mean they always will; data start only in 2011. ●●●Supported by the data
3. Periods when it did not holdAcross 10 5-year periods, out of step in none.

History

The two lines, overlaid

Philly FedIndustrial output

Time lag

At what lag do they match best?

Longer bar = moves more in the direction of the common explanation (the number is the agreement).

• same month+0.47
• 3-month lag+0.40
• 6-month lag+0.30
• 9-month lag+0.17
• 12-month lag−0.07
• 18-month lag−0.27

Limits

What this card cannot tell you

• Moving together does not prove that one causes the other.
• Links change over time; periods when this one did not hold are listed in full.
• This is the historical record, not a forecast.