Even before the recent tightening of COVID-19 restrictions in many major economies, CLIs compiled for October 2020 pointed to a continued deceleration in the pace of improvement in the OECD as a whole and across most major economies.
Whilst some expectation of these recent measures will have been anticipated in this month’s CLI estimates, their full impact will only be picked-up in next month’s CLI estimates.
Prior to the introduction of recent COVID-19 containment measures, CLIs for October in the United States, Japan, Canada, Germany, Italy and the euro area continued to increase but at a slower pace. In France, the CLI continued to stabilise, while in the United Kingdom the CLI contracted for the second straight month, potentially reflecting heightened uncertainty over the prospect of no trade deal with the EU at the end of the transition period. In all major OECD economies, the CLIs continued to point to below trend GDP.
Among major emerging economies, the CLIs for India and Brazil continued to increase but a slower pace. In China, on the other hand, the CLI for October, for the manufacturing sector, continued to increase at a steady pace, while in Russia the CLI stabilised.
As always, the magnitude of the CLI should be regarded as an indication of the strength of the signal rather than as a direct measure of the degree of growth in economic activity.
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