Composite leading indicators point to stable growth momentum in the OECD area
Composite leading indicators (CLIs) are designed to anticipate turning points in economic activity relative to trend six to nine months ahead, using a range of indicators that have leading properties in relation to future movements in the economic cycle.
In July, the OECD CLI Press Release was suspended for two months in order to accommodate incoming data that were able to capture changes in expectations and outturns in the United Kingdom and in other countries following the June 23, 2016 referendum in the UK.
Although there remains uncertainty about the nature of the agreement the UK will eventually conclude with the EU, the volatility in data that emerged in the weeks immediately following the referendum appears to have reduced. Assuming this remains the case for the next 6 months, the current assessment for the United Kingdom points to growth continuing to slow, before stabilising around a lower rate towards the end of the year.
Stable growth momentum is anticipated in the OECD area as a whole, the United States, Japan as well as the euro area, including Germany.
In Canada, the CLI indicates growth picking up.
On the other hand, growth is expected to ease in France, while the CLI for Italy points to a more severe weakness in growth momentum.
Amongst major emerging economies, the CLIs continue to indicate that growth is picking up in China, Russia and Brazil, while the CLI for India continues to point to firming growth.