Global Economy
OECD composite leading indicators point to continued expansion
By Finfacts Team
Feb 14, 2011 - 12:00 PM

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Composite leading indicators (CLIs) for December 2010, designed to anticipate turning points in economic activity relative to trend, continue to point to expansion in most major OECD countries.

The CLIs for Germany, Japan and the United States point to relatively robust expansion relative to trend, while in Canada, France and the United Kingdom the CLIs point to continued moderate expansion. There are nevertheless signs of a downturn emerging in Italy.

New data for China point to a downturn, reversingthe tentative signs of regained growth momentum reported in last month’s assessment. With three of its seven components pointing upward the outlook remains volatile. The CLI for India is pointing towards a slowdown. In Russia, the CLI continues to point to an expansion, while Brazil is expected to continue to perform close to its long-term trend.

Composite leading indicators (CLIs) for December 2010, designed to anticipate turning points in economic activity relative to trend, continue to point to expansion in most major OECD countries.

The CLIs for Germany, Japan and the United States point to relatively robust expansion relative to trend, while in Canada, France and the United Kingdom the CLIs point to continued moderate expansion. There are nevertheless signs of a downturn emerging in Italy.

New data for China point to a downturn, reversingthe tentative signs of regained growth momentum reported in last month’s assessment. With three of its seven components pointing upward the outlook remains volatile. The CLI for India is pointing towards a slowdown. In Russia, the CLI continues to point to an expansion, while Brazil is expected to continue to perform close to its long-term trend.

A large set of component series, selected from a wide range of economic indicators, are used in constructing CLIs (224 series are used in total, about 5-10 for each country). CLIs are calculated for 29 OECD countries and 9 zones. They are calculated in three forms: amplitude adjusted, trend-restored, and year-on-year growth rate. These are comparable, respectively, with the de-trended reference series, the original reference series and the year-on-year growth rate of the reference series. The press release focuses on the amplitude adjusted form of the CLI, and includes the major countries and zones.

The OECD (Organisation for Economic Cooperation and Development) - Total covers the following 29 countries: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Japan, Korea, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey, United Kingdom, and United States.

The G7 area covers Canada, France, Germany, Italy, Japan, United Kingdom and United States.

The Euro area (only Euro area countries that are members of OECD) covers the following 13 countries: Austria, Belgium, Finland, France, Germany, Greece, Italy, Ireland, Luxembourg, the Netherlands, Portugal, Slovak Republic and Spain.

The Major Five Asia area covers China, India, Indonesia, Japan and Korea.


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