November 28, 2017

Economic Outlook – leading indicators at a glance

Germany – leading indicators show positive development

The leading indicators for the German economy remain optimistic. The Ifo Business Climate Index (Ifo-Geschäftsklimaindex) reached a new all-time high in October, both the assessment of the situation and the expectations improved compared to the previous month. The same applies to the sentix Economic index. The Purchasing Managers' Index for the German Industry (Einkaufsmanagerindex) remained unchanged at the high level of 60.6 points. The ZEW Indicator of Economic Sentiment (ZEW-Konjunkturindikator) increased slightly while the Economic Sentiment Indicator went up noticeably. Only the truck performance increased less strongly than in the previous month.

Eurozone – leading indicators give rise to optimism

The leading indicators for the Eurozone continue to spread optimism. In the Sentix Economic Index (sentix-Konjunkturindex), both the assessment of the situation and the expectations improved significantly. The Economic Sentiment Indicator (ESI) is on the upside as well, just as the manufacturing Purchasing Managers’ Index for the Industry (Einkaufsmanagerindex), which climbed up to 58.5 points in October. By contrast, the ZEW Indicator of Economic Sentiment (ZEW-Konjunkturindikator) went down to some extent.

The most recent quarterly Ifo Index for the Eurozone has improved compared to the previous quarter, with the balance rising from +35.2 to +37.0 percentage points. However, the expected balance fell by 5.8 to +31.3 points, the balance of the situation assessment increased by 9.5 to +42.9 points.

World Economy – leading indicators on the rise

The leading indicators for the global economy are pointing upwards as well. After a small dip, the German Federal Bank’s leading indicator (Bundesbank Frühindikator) for the global economy is back on track, with the OECD business climate index (OECD-Geschäftsklima) continuing to improve. Although the Purchasing Managers’ Index for the global Industry (Einkaufsmanagerindex) gave in slightly, it remains at a level as it did six years ago, with 55.4 points. The RWI Container Throughput Index continued to improve, while the Baltic Dry Index went down in recent days, but is also pointing upwards in terms of the general trend. The most recent quarterly Ifo Index for the world economy also rose compared to the previous quarter, with the index rising 3.9 points up to +17.1 points. This development goes back to an improvement in the assessment of the situation by 4.7 to +17.2 percentage points and an increase in expectations by 2.9 to +16.9 points.

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Economic Outlook November 2017

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