Most major economies are showing signs of moderating growth, with composite leading indicators still remaining at above-trend levels, the Organization for Economic Co-operation and Development (OECD) said on Tuesday.
The OECD Composite Leading Indicators (CLI), designed to anticipate turning points in activity relative to its trend, show signs of moderating the pace of growth, to above-trend levels , in the OECD area as a whole and in most of the major economies, details the International Organization in this regard.
She also notes that the latest ICAs are showing signs of moderating the pace of growth, while remaining above trend, in the United States, Japan and Canada. Similar signs are emerging in the UK as well as in the euro area as a whole, particularly in Germany and Italy.
For example, argues the OECD, in France, signs of moderation in the pace of growth are also appearing but with an ICA still below the trend.
As for the ICAs of the main emerging economies, they show divergent trends.
Steadily increasing growth is maintained in China (for the manufacturing sector), as well as stable growth in India, while in Brazil, the ICA continues to indicate a slowdown in growth. Signs of a moderation in the pace of growth are emerging in Russia.
The OECD further notes that despite the gradual lifting in certain countries of restrictions linked to Covid-19 and the progress of vaccination campaigns, the persistent uncertainties could continue to generate larger-than-normal fluctuations in the ICA. and its components.
And hence, she notes, ICAs should be interpreted with caution and their magnitude should be seen as an indication of the strength of the signal rather than a measure of the degree of growth in economic activity.