The latest composite leading indicators (CLIs) suggest that a moderate downturn in economic activity lies ahead in the OECD area. September 2007 data indicate a weakening outlook for all the major seven
economies except Canada. The latest data for major OECD non-member economies point to continued steady expansion in China, India and Brazil and a slightly improved outlook for Russia.

The CLI for the OECD area decreased 0.8 point in September and is 1.5 point lower than a year ago. The CLI for the United States decreased by 0.6 point in September and is only 0.1 point higher than a year ago. The Euro area’s CLI decreased by 0.5 point in September and stands 1.8 point lower than a year ago. In September 2007, the CLI for Japan fell by 2.9 points, and indicates a strong slowdown (9.0 points lower than a year ago) driven mainly by the “Dwellings started” component of the CLI, which reflects a backlog due to administrative changes in the Building Standard Law.

The CLI for the United Kingdom decreased by 0.1 point in September but it is 0.4 point higher than a year ago. The CLI for Canada increased by 0.2 point in September and stands 2.4 points higher than a year ago. For France, the CLI decreased by 0.5 point in September and is 0.9 point lower than a year ago. The CLI for Germany fell 1.0 point in September and it is 2.6 points lower than a year ago. For Italy the CLI decreased by 0.3 point in September and is 2.3 points lower than a year ago.

The CLI for China rose 0.4 point in September 2007 and stands 3.8 points higher than a year ago. The CLI for India increased by 0.2 point in August and is 1.7 point higher than a year ago. The CLI for Russia was unchanged in September 2007, but the level is 1.9 point lower than a year ago. In September 2007 the CLI for Brazil increased by 1.1 point and stands 4.5 points higher than a year ago.