ACC's chemical barometer grows in April

14:39 PM | April 23, 2013 | Lindsay Frost

ACC has released its chemical activity barometer (CAB) for March, showing that the US economy continues to grow slowly. On a 3-month moving average (3MMA) basis, the CAB increased 0.2% over March, to 93—the indicator’s ninth consecutive gain, after the March number was revised upward 0.1%. The year-on-year 3MMA was up 3.1% over April 2012, to 92.8. The CAB is an economic indicator derived from a composite index of chemical industry activity.

"We're still seeing growth—albeit slow—and that's good news," says ACC director/economics and policy analysis Martha Moore. "The data are actually showing a break from the trends of the past three years, in which we've had a first-quarter false-positive only to have things drop off during the second and third quarters of the year.”

Production, product prices, and inventories were all up, while chemical company equities were down. Moore says flattening activity in construction-related plastic resins, coatings, pigments, and other building- and construction-related chemistry may suggest that the pace of housing recovery will slow. However, plastic resins used in consumer and institutional applications continue to expand suggesting further, moderate gains driven by consumers. "The growth is decelerating, but overall the chemical activity barometer continues to suggest measured expansion of the US economy through 2013," Moore says.

The CAB comprises indicators relating to the production of chlorine and other alkalies, pigments, plastic resins, and other selected basic industrial chemicals; chemical company stock data; hours worked in chemicals; publicly sourced chemical price information; end-use (or customer) industry sales-to-inventories; and several broader leading indicators, such as building permits and new orders.