The release of the OECD Composite leading indicators (CLIs), originally scheduled for 9 March 2020, has been cancelled. The next release will be 8 April 2020.
OECD’s CLIs are designed to anticipate turning points in economic activity. They are constructed using a suite of underlying indicators that are selected on the basis of their forward-looking properties in relation to future movements in the economic cycle. The CLIs have proved to be an effective tool, including during periods of extreme volatility such as the financial crisis, the European debt crisis or the more recent slowdown, precisely because the underlying sub-components have been able to capture and reflect economic agents’ expectations about future movements in the economic cycle (see OECD Statistics Working Papers).
At this time, CLI sub-components for many countries are not yet able to capture the effects of the more widespread Covid-19 outbreak.
Timely as they are, sub-components are not able to capture significant unpredictable changes in the macro-economy nor in expectations that may have occurred in the days and weeks following their collection. In Europe, for example, tendency surveys were collected before the scale of the Covid-19 outbreak in Northern Italy became known. In countries such as China, Japan and Korea, which were all much closer to the epicentre of the outbreak, the effects have already started to appear in CLI sub-components, and so too, in our current assessment for these countries, which is easing growth momentum. However, the rapidity of the outbreak in other countries in recent weeks, has meant that the impact has not yet been reflected in the CLI sub-components for these countries.
The 8 April release of the OECD CLIs will reflect this information.