15. January 2016

Economic Outlook - January 2016

Germany - Inconsistent development of leading indicators

The leading indicators for Germany do not provide a clear picture. The ifo Business Climate Index (ifo-Geschäftsklimaindex) decreased due to a slightly worse assessment of the business situation. The business expectations remained the same as in the previous month. For the Sentix Economic Index (sentix-Konjunkturindex), the assessment of both the business situation and the business expectations declined. The Economic Sentiment Indicator remained the same as in December 2015. The ZEW Indicator of Economic Sentiment (ZEW-Konjunkturindikator) and the Purchasing Managers’ Index for the German Industry (Einkaufsmanagerindex) were able to recover from their previously low levels. The latter has risen to 53.2 points, placing it well above the growth threshold. There is still no data available on the mileage of trucks (according to the toll statistics).

Eurozone - Differentiated signals

The development of the leading indicators for the Eurozone is also quite differentiated. The Economic Sentiment Indicator, the ZEW Indicator of Economic Sentiment (ZEW-Konjunkturindikator) and the Purchasing Managers’ Index for the Industry in the Euro area (Einkaufsmanagerindex) all improved. The latter rose to 53.1 points, placing it well above the growth threshold. The Sentix Economic Index (sentix-Konjunkturindex) on the other hand went down, due to both the assessment of the business situation and the business expectations. The ifo Index for the Economic Climate in the Eurozone also dropped. While the assessment of the business situation improved compared to three months ago, business expectations for the upcoming months decreased noticeably.

World Economy - Regressive leading indicators for the world economy

Almost all of the leading indicators for the world economy point downwards. Solely the Container Throughput-Index (Containerumschlagsindex) recovered slightly. The Baltic Dry Index, on the other hand, dropped to its lowest level in more than ten years. The OECD-leading indicator remained significantly below its long-time average. The German Federal Bank’s leading indicator (Bundesbank Frühindikator) for the world economy and the Purchasing Managers’ Index (Einkaufsmanagerindex) for the industry both declined. The latter now sits exactly on the growth threshold. The ifo World Economic Climate Index also dropped. The assessment of both the current economic situation and the business expectations was worse than three months ago.

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Economic Outlook - January 2016

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