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The three-month average of the Chicago Fed National Activity Index (CFNAI) is expected to decline slightly to -0.04 in the February update that's scheduled for release on Monday (Mar. 24), according to our median econometric forecast. In the previous release for January, the three-month average was +0.10, a reading that equates with economic expansion. Only values below -0.70 indicate an "increasing likelihood" that a recession has started, according to guidelines from the Chicago Fed. Based on today's estimate for February, CFNAI's three-month average is projected to remain at a level that's historically associated with growth, but at a marginally below-trend pace.

Here's a closer look at the numbers, followed by brief definitions of the methodologies behind our projections:

VAR-4A: A vector autoregression model that analyzes four economic time series to project the Chicago Fed National Activity Index: the Capital Spectator's Economic Trend and Momentum Indexes, the Philadelphia Fed US Leading Indicator, and the Philadelphia Fed US Coincident Economic Activity Indicator. VAR analyzes the interdependent relationships of these series with CFNAI through history. The forecasts are run in R with the "vars" package. (Update: the January report for the Philadelphia Fed US Leading Indicator isn't available as of Mar. 21 and so this indicator has been omitted from the current VAR-4A estimate.)

VAR-4B: A vector autoregression model that analyzes four economic time series to project the Chicago Fed National Activity Index: US private payrolls, real personal income less current transfer receipts, real personal consumption expenditures and industrial production. VAR analyzes the interdependent relationships of these series with CFNAI through history. The forecasts are run in R with the "vars" package.

ARIMA: An autoregressive integrated moving average model that analyzes the historical record of the Chicago Fed National Activity Index in R via the "forecast" package.

ES: An exponential smoothing model that analyzes the historical record of the Chicago Fed National Activity Index in R via the "forecast" package.

Source: Chicago Fed National Activity Index: February 2014 Preview