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, reversing the 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.
Table 1: Composite Leading Indicators
| Ratio to trend, amplitude adjusted | Change from previous month | Year on Year change | Growth cycle outlook** | |||||||||
| (long term average =100) | (points) | (points) | ||||||||||
| 2010 | 2010 | Latest month | ||||||||||
| Aug | Sep | Oct | Nov | Dec | Aug | Sep | Oct | Nov | Dec | |||
| OECD Area | 102.1 | 102.2 | 102.3 | 102.5 | 102.8 | 0.0 | 0.1 | 0.2 | 0.2 | 0.3 | 2.2 | regained growth momentum |
| Euro Area | 103.0 | 103.0 | 103.0 | 103.2 | 103.3 | 0.0 | 0.0 | 0.1 | 0.1 | 0.2 | 1.6 | stable pace of expansion |
| Major Five Asia* | 101.1 | 101.1 | 101.1 | 101.1 | 101.0 | -0.2 | 0.0 | 0.0 | 0.0 | -0.1 | -1.2 | downturn |
| Major Seven | 102.0 | 102.2 | 102.4 | 102.6 | 103.0 | 0.0 | 0.1 | 0.2 | 0.3 | 0.3 | 2.5 | regained growth momentum |
| Canada | 101.7 | 101.5 | 101.5 | 101.6 | 101.7 | -0.3 | -0.2 | 0.0 | 0.1 | 0.2 | -0.1 | stable pace of expansion |
| France | 101.9 | 101.9 | 102.0 | 102.2 | 102.3 | -0.1 | 0.0 | 0.1 | 0.1 | 0.1 | -1.9 | stable pace of expansion |
| Japan | 101.9 | 102.2 | 102.7 | 103.3 | 103.9 | 0.2 | 0.3 | 0.4 | 0.6 | 0.7 | 4.9 | expansion |
| Germany | 104.5 | 104.5 | 104.6 | 104.7 | 105.0 | 0.0 | 0.0 | 0.1 | 0.2 | 0.2 | 4.9 | expansion |
| Italy | 102.8 | 102.6 | 102.5 | 102.4 | 102.3 | -0.2 | -0.2 | -0.1 | -0.1 | -0.1 | -1.5 | downturn |
| United Kingdom | 102.2 | 102.1 | 102.2 | 102.2 | 102.3 | -0.2 | -0.1 | 0.0 | 0.1 | 0.1 | -0.8 | stable pace of expansion |
| United States | 101.4 | 101.5 | 101.8 | 102.1 | 102.5 | 0.0 | 0.2 | 0.3 | 0.3 | 0.4 | 3.2 | expansion |
| Brazil | 99.3 | 99.3 | 99.5 | 99.8 | 100.0 | -0.3 | 0.0 | 0.2 | 0.2 | 0.2 | 0.2 | stable pace around long-term potential |
| China | 100.8 | 100.7 | 100.8 | 100.7 | 100.5 | -0.4 | -0.1 | 0.1 | -0.1 | -0.2 | -3.4 | downturn |
| India | 100.9 | 100.6 | 100.3 | 99.8 | 99.3 | -0.2 | -0.3 | -0.4 | -0.5 | -0.5 | -2.1 | slowdown |
| Russia | 103.2 | 103.9 | 104.6 | 105.1 | 105.5 | 0.8 | 0.7 | 0.6 | 0.5 | 0.4 | 7.4 | expansion |
* China, India, Indonesia, Japan and Korea.
** Growth cycle phases of the CLI are defined as follows: expansion (increase above 100), downturn (decrease above 100), slowdown (decrease below 100), recovery (increase below 100). CLI data for 29 OECD member countries and 6 OECD non-member economies available at: http://stats.oecd.org/wbos/default.aspx?datasetcode=MEI_CLI
Table 2: Historical Performance of CLI and Recent Cyclical Turning Points in the Reference Series
| CLI Historical Performance | Recent Turning Point dates in the reference series | ||||||||
| Lead at all turning points | Dates marked with (P) are provisional turning points | ||||||||
| start year | mean | st. dev. | trough | peak | trough | peak | trough | peak | |
| OECD Area | 1961 | 6 | 3.5 | Jan 2002 | Feb 2008 | May 2009 P | |||
| Euro Area | 1963 | 7 | 3.1 | Jul 2003 | Mar 2008 | May 2009 P | |||
| Major Five Asia* | 1983 | 8 | 5.8 | Dec 2001 | May 2004 | Jun 2005 | Jan 2008 | Mar 2009 P | Apr 2010 P |
| Major Seven | 1959 | 6 | 3.7 | Jan 2002 | Mar 2008 | May 2009 P | |||
| Canada | 1956 | 8 | 3.7 | Nov 2001 | Aug 2007 | Jun 2009 P | |||
| France | 1962 | 7 | 4.9 | Jul 2003 | Feb 2008 | Apr 2009 P | |||
| Japan | 1959 | 6 | 4.5 | Dec 2001 | Mar 2008 | Apr 2009 P | Jun 2010 P | ||
| Germany | 1961 | 5 | 4.0 | Jul 2003 | Mar 2008 | May 2009 P | |||
| Italy | 1973 | 7 | 5.8 | Feb 2005 | Mar 2008 | May 2009 P | |||
| United Kingdom | 1958 | 7 | 5.2 | Apr 2003 | Apr 2004 | Aug 2005 | Feb 2008 | Jun 2009 P | |
| United States | 1955 | 5 | 3.4 | Dec 2001 | Feb 2008 | May 2009 P | |||
| Brazil | 1989 | 5 | 2.3 | Jun 2003 | Oct 2004 | Aug 2006 | May 2008 | Apr 2009 P | Apr 2010 P |
| China | 1990 | 6 | 4.9 | Jan 2002 | Jan 2008 | Feb 2009 P | Jan 2010 P | ||
| India | 1994 | 4 | 2.7 | Apr 2003 | Mar 2007 | Feb 2009 P | Feb 2010 P | ||
| Russia | 1993 | 3 | 2.3 | Jul 2002 | Jun 2004 | Sep 2005 | Apr 2008 | May 2009 P | |
* China, India, Indonesia, Japan and Korea
OECD data.
Oipol & Oijust 