OECD Signals Mixed Outlook for Global Economies
Dec 11, 2006
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The latest composite leading indicators (CLIs) suggest that continued economic expansion lies ahead in the OECD area. October 2006 data show weakening performance in the CLI’s 6-month rate of change in the Euro area and the U.S., but improved performance in Japan. Interest rate spreads are said to be contributing negatively to the performance of the CLIs in all the major seven economies, while business confidence is contributing positively in the Euro area and negatively in Canada and the U.S.

The latest data for major OECD non-member economies point to a weakening outlook for Russia, moderating growth in China and India, and steady expansion in Brazil. Click for OECD Definitions.

The CLI for the OECD area increased by 0.2 point in October to 109.7, from 109.5 in September, but its 6-month rate of change shows a downward trend since March 2006.

October CLIs by Country in the OECD and China

  • U.S. - The CLI rose by 0.1 point in October, but its 6-month rate of change was slightly down from the upturn noted in September after previously haven fallen since February 2006.
  • Euro area – The CLI increased by 0.3 point in October, but its 6-month rate of change has fallen for the last 5 months.
  • Japan – The CLI rose by 0.2 point, and its 6-month rate of change has increased for the last 3 months.
  • United Kingdom – The CLI increased in October by 0.2 point and its 6-month rate of change was up, after having been relatively flat since June 2006.
  • Canada - The CLI increased by 0.9 point in October, and its 6-month rate of change shows an upward trend since May 2006.
  • France - The CLI rose by 0.3 point in October, and its 6-month rate of change has been relatively stable since October 2005.
  • Germany - The CLI increased by 0.6 point in October and its 6-month rate of change was up for the first time since April 2006.
  • Italy - The CLI fell by 0.1 point in October and its 6-month rate of change has decreased for the last 5 months.
  • China - The CLI rose by 2.6 points in October, although its 6-month rate of change shows a downward trend since April 2006.
  • India - The CLI increased by 2.2 points in September, and its 6-month rate of change was up for the third month in a row.
  • Russia - The CLI fell by 0.8 point in October and its 6-month rate of change dropped for the sixth consecutive month.
  • Brazil - The CLI for Brazil rose by 1.9 point and its 6-month rate of change increased for the last 5 months.

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