August 08, 2017

Economic Outlook – leading indicators at a glance

Germany – leading indicators continue to excel

With almost no exception, leading indicators for the German economy are at a very high level and – in some cases – continue to rise. In June, the Ifo Business Climate Index (Ifo-Geschäftsklimaindex) again hit its all-time high. Both the assessment of the situation and the expectations improved. The Purchasing Managers’ Index for the German Industry (Einkaufsmanagerindex) also rose slightly by 0.1 to 59.6 points, the highest level since 2011. The Economic Sentiment Indicator improved, too – to the highest level in six years. According to the toll statistics, truck traffic has grown significantly. Only the ZEW Indicator of Economic Sentiment (ZEW-Konjunkturindikator) as well as the sentix Economic index slightly declined, but – particularly the latter one – from a very high level.

Eurozone – leading indicators continue to go up

The leading indicators for the euro zone continue to rise. Thanks to a better assessment of the situation, the Sentix Economic Index (sentix-Konjunkturindex) continued to improve slightly. However, the expectations slowed down somewhat. The Economic Sentiment Indicator (ESI) went up to the highest level in ten years for both the Eurozone and the EU as a whole. At the same time, the Purchasing Managers’ Index for the Industry (Einkaufsmanagerindex) continued to grow to 57.4 points. The ZEW Indicator of Economic Sentiment (ZEW-Konjunkturindikator) also rose moderately.

The most recent quarterly Ifo Index for the Eurozone was published in May. The balance of positive and negative assessments rose from +17.2 to +26.4 percentage points. The balance on the current situation improved from +8.0 to +21.9 points, the balance of the expectations increased from +26.9 to +31.0 points.

World Economy – most leading indicators show positive development

The global leading indicators send positive signals, too. The OECD business climate index (OECD-Geschäftsklima) improved slightly and remains at its long-term average level. The German Federal Bank’s leading indicator (Bundesbank Frühindikator) for the world economy also rose, but at an increasingly weaker pace. The Purchasing Managers’ Index for the global Industry (Einkaufsmanagerindex) grew by 0.6 points to 54.7 points, clearly above the growth threshold of 50 points. The Container Throughput Index improved as well, while the Baltic Dry Index continued its decline.

The most recent quarterly Ifo Index for the world economy was published in May. The index continued to improve from +2.6 to +13.0 percentage points. The balance of the assessment of the current situation left the negative range behind and increased from -9.1 to +4.7 points. The expectation balance improved from +15.0 to +21.6 percentage points.

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Economic Outlook August 2017

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