The Macro Composite is a tool used to assess the overall health of the US economy. It combines a variety of economic indicators like employment, interest rates, housing, transportation, and inflation into one score. This score helps investors understand the direction of the economy and what phase of the economic cycle we’re in.


Updated monthly, the composite score reflects the latest economic data and trends. Think of it like a gauge on a dashboard, showing whether the economy is trending up or down. The regime classification below the score indicates the momentum of the economy based on the composite score.



While the composite score typically shows stability, it can also vary greatly from month to month. To smooth out these fluctuations and identify the overall trend in economic indicators, a 6-month moving average is used. When this average dips below 0, it signals a shift from economic strength (Risk-On) to weakness (Risk-Off). However, because this model operates on a monthly basis and aims to steer clear of economic downturns, it may not react quickly enough to major market crashes like the one in March 2020. This limitation means it may not always capture sudden and severe economic downturns.

The FRED Macro Data Monitor offers an objective overview of current economic indicators compared to past trends and a predictive variable. For your convenience, this section features a curated set of charts covering economic, inflation, employment, financial, and housing indicators. Additionally, by navigating to the Custom tab, you can connect to the FRED API and build your own charts to analyze virtually any indicator tracked in their database.

These visualizations facilitate comprehensive analysis of economic variables by addressing questions such as:

  1. Is the economic indicator behaving as expected for this stage of the macroeconomic cycle?
  1. Given our current position in the cycle, how might the economic indicator behave in the future?

For instance, consider the chart above depicting the U.S. Unemployment Rate following the First Monthly Inversion of the 10Y-3M yield curve spread. The X axis represents months since the inversion, ranging from 0 to 18 months, while the Y axis normalizes the metric at the start date to 100 percent. As of Marcg 2024, 12 months have elapsed since the first monthly inversion. Notable observations from this chart include:

  1. Early post-inversion, the Unemployment Rate fluctuates widely between maximum and minimum bands due to the low base unemployment rate relative to historical periods.
  1. The unemployment rate is below the mean unemployment rate 12 months after the first 10Y-3M inversion.
  1. Most importantly, 12 months and beyond is when the unemployment rate starts to increase meaningfully following the 10Y-3M inversion, indicating a significant shift in economic conditions.

Trigger Events

Trigger events provide a method for organizing the starting points of historical data in the FRED Macro Data Monitor based on the onset of specific macroeconomic events. The four trigger event options include:

  1. The First Monthly Inversion of the 10Y-3M spread.
  2. The First Monthly Reversion of the 10Y-3M spread.
  3. The Start of a Recession
  4. The End of a Recession.


Data Transformation Options

Exploring a dataset from various angles can help you better understand just how recent data aligns with historical trends. Our Macro Data Monitor charts provide several transformation options for this purpose:

  1. View by Individual Date: This option allows users to see each individual signal throughout history, providing a more detailed view than a simple distribution. It also allows users to see how many signals have occurred throughout history.