Source: OECD

The latest composite leading indicators (CLIs) suggest that a moderation in economic expansion lies ahead in the OECD area. August 2007 data show weakening performance in the CLI’s six month rate of change in all the major seven economies. The latest data for major OECD non-member economies point to moderating expansion in China, India and Brazil, but an improved outlook for Russia.

The CLI for the OECD area decreased 0.6 point in August to 109.6 from 110.2 in July and its six-month rate of change decreased for the second month in a row.

The CLI for the United States fell by 0.7 point in August and its six-month rate of change decreased for the second time after a sequence of increases over the previous six months. The Euro area’s CLI decreased by 0.5 point in August and its six-month rate of change has a downward trend since June 2006. In August 2007, the CLI for Japan fell by 0.8 point and its six-month rate of change has a downward trend since April 2006.

The CLI for the United Kingdom fell by 0.6 point in August and its six-month rate of change decreased for the second consecutive month. The CLI for Canada decreased by 0.2 point in August and its six-month rate of change decreased for the second month in a row. For France, the CLI fell by 0.7 point in August and its six-month rate of change decreased for the second consecutive month. The CLI for Germany fell by 0.9 point in August and its six-month rate of change decreased for the third month in a row. For Italy the CLI fell by 1.0 point in August while its six-month rate of change has had a downward trend since July 2006.

The CLI for China rose by 3.5 points in August 2007 and its six-month rate of change continues to stay well above long term growth rate level. The CLI for India decreased 0.5 point in July and its six-month rate of change decreased for the first time following increases over the previous three months. The CLI for Russia rose by 0.3 point in August 2007. Its six-month rate of change has also increased for six consecutive months. In August 2007 the CLI for Brazil increased by 0.4 point but its six-month rate of change decreased for the third consecutive month.