OECD growth indicators point to slowdown in EU and US

Leading economic indicators are continuing to indicate slowing growth in North America and Europe, the OECD said on Monday.

The Organisation for Economic Co-operation & Development published the latest update to its composite leading indicators (CLIs) designed to anticipate turning points in economic activity six to nine months ahead of time.

After tentative signs of easing growth momentum in the US and actual signs of easing momentum in Germany were flagged a month ago, the Paris-headquartered economic thinktank said these have been confirmed.

The OECD's CLI system is designed to provide early signals of any fluctuations in the output gap around its long term potential level, which the organisation believes is a more qualitative rather than quantitative view.

Slowing growth momentum is also on the cards for the euro area as a whole, the UK and Canada.

In Japan, the CLI continues to point to "stable growth", with China and India also seen as stable, with the latter's momentum stabilising after indication of signs of stability were seen the month before.

For Brazil and Russia the assessment remains for growth momentum to ease down.

Based on historical data, the phases and patterns in CLIs are often subsequently seen in the actual business cycle, with the lead-time varying around the aimed-for of 6-9 months.