The latest composite leading indicators (CLIs) suggest that some moderation in economic expansion lies ahead in the OECD area. January 2007 data show weakening performance in the CLI’s six month rate of change in all the Major Seven economies.

Business confidence is contributing negatively to the performance of the CLIs in these same countries, while the spreads between short and long-term interest rates are contributing positively in the United States, Japan, France and Germany. The latest data for major OECD non-member economies point to strong expansion in China and India.

The CLI for the OECD area was unchanged in January 2007 at 109.5, but its six-month rate of change shows a downward trend since March 2006. The CLI for the United States decreased by 0.3 point in January with its six-month rate of change showing a downward trend since March 2006. The Euro area’s CLI decreased 0.1 point in January and its six-month rate of change has fallen since June 2006. In January 2007, the CLI for Japan fell by 0.5 point and its six-month rate of change has a downward trend since March 2006.

The CLI for the United Kingdom decreased by 0.2 point in January and its six-month rate of change shows a downward trend since May 2006. The CLI for Canada rose by 0.2 point in January, but its six-month rate of change decreased over the last two months. For France the CLI was unchanged in January, while its six-month rate of change decreased for the third consecutive month. The CLI for Germany decreased by 0.2 point in January and its six-month rate of change shows a downward trend since May 2006. For Italy the CLI decreased by 0.3 point in January and its six-month rate of change shows a downward trend since July 2006.

The CLI for India increased by 1.6 point in December 2006. Its six-month rate of change was up for the fifth month in a row. The CLI for Russia rose by 0.5 point in January 2007, but its six-month rate of change shows a downward trend since April 2006. In January 2007, the CLI for Brazil increased by 0.3 point, while its six-month rate of change has been relatively stable since April 2006. No update is yet available for China since the February 2007 news release where its CLI showed a strong 5.9 points rise in December 2006 and its six-month rate of change increased for the third consecutive month.