Composite Leading Indicators : Is the economic recovery slowing?

The OECD’s Composite Leading Indicators (CLIs) are designed to provide early signals of turning points in business cycles. By showing fluctuations in the output gap, they provide qualitative information about economic activity.

The latest CLI release, published on 12 October, showed a moderation in the pace of expansion in economic activity in the OECD area, reflecting the slow-down of the post-pandemic rebound. It remains above trend in many economies, but rising consumer prices (esp. energy prices) are one factor bringing CLIs down.

CLIs already pointed to a slow-down in the pace of expansion in Canada, the euro area and the UK last month; similar indications have now emerged in the US and Japan. The picture for emerging-market economies is mixed: CLI in China points to stable growth rather than a steady increase reported last month; CLI also points to stable growth in India, but with real GDP below long-term growth trend; slowing growth is anticipated in Brazil; and in Russia CLI points to a steady increase in GDP growth above long-term trends.

The easing of COVID-19 containment measures has helped the rebound, but on-going uncertainties may mean higher-than-usual fluctuations in CLI as we look forward.

More about CLIs.