Growth indicator for G7 falls in July
PARIS: The outlook for economic growth in the Group of Seven leading industrial nations is weakening and expansion in OECD member countries should continue at a cooler pace, an OECD report said on Friday.
The Paris-based Organisation for Economic Cooperation and Development said its composite leading indicator (CLI) for the G7 area fell to 106.2 in July from a downwardly revised 106.4 in June.
A less volatile measure, the six-month rate of expansion, also fell for the G7, to 1.9 in July from a downwardly revised 2.5 in June.
"July 2007 data show weakening performance in the CLI's six month rate of change in all the major seven economies," the OECD said.
Earlier this week, the OECD downgraded its forecasts of 2007 gross domestic product growth for the G7 in an interim economic outlook report. All G7 countries except Britain and Canada saw reductions in their growth outlooks.
The CLI is compiled from a wide range of short-term economic indicators, about five to 10 from each country. Figures
OECD Economist Ronny Nilsson said the report was unlikely to reflect recent financial market turmoil because it dated only from July, and since it focuses on a variety of economic indicators that only sometimes include financial data.
"It depends on the country -- for some countries we look at the construction sector and even some financial data including share prices indices, but not in all countries," Nilsson said.
"And of course this is a lagging figure, and it only covers up to July data, and that was the first month where you could
have seen some trace of volatility. So there may be more to come in next month's update," he said.
The report also highlighted a downturn in figures from Japan, which saw its six-month rate of change drop to minus 2.1 in July from a downwardly revised minus 0.8 in June.
The leading indictor for Japan fell to 105.4 from a downwardly revised 106.2.
The survey also pointed to cooling expansion in China and Brazil, but an improved outlook for India and Russia.
The Paris-based Organisation for Economic Cooperation and Development said its composite leading indicator (CLI) for the G7 area fell to 106.2 in July from a downwardly revised 106.4 in June.
A less volatile measure, the six-month rate of expansion, also fell for the G7, to 1.9 in July from a downwardly revised 2.5 in June.
"July 2007 data show weakening performance in the CLI's six month rate of change in all the major seven economies," the OECD said.
Earlier this week, the OECD downgraded its forecasts of 2007 gross domestic product growth for the G7 in an interim economic outlook report. All G7 countries except Britain and Canada saw reductions in their growth outlooks.
The CLI is compiled from a wide range of short-term economic indicators, about five to 10 from each country. Figures
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available three days before the official release date are generally factored into the calculation. OECD Economist Ronny Nilsson said the report was unlikely to reflect recent financial market turmoil because it dated only from July, and since it focuses on a variety of economic indicators that only sometimes include financial data.
"It depends on the country -- for some countries we look at the construction sector and even some financial data including share prices indices, but not in all countries," Nilsson said.
"And of course this is a lagging figure, and it only covers up to July data, and that was the first month where you could
have seen some trace of volatility. So there may be more to come in next month's update," he said.
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The report also highlighted a downturn in figures from Japan, which saw its six-month rate of change drop to minus 2.1 in July from a downwardly revised minus 0.8 in June.
The leading indictor for Japan fell to 105.4 from a downwardly revised 106.2.
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The survey also pointed to cooling expansion in China and Brazil, but an improved outlook for India and Russia.
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