REYKJAVIK, Iceland, Dec. 18, 2014 (GLOBE NEWSWIRE) -- The Iceland Composite Leading Indicator (CLI) rose by 0.5 percent in November for the third month in row. The CLI hints at growth picking up in early 2015.
Economic growth during the first nine months of the year fell short of general expectations. However, this comes as no surprise given the developments of some of the individual CLI components, in particular the slow growth in the inflation adjusted debit card turnover. The rise in import volumes to some extent reflects the fast pace of growth in the number of tourists which in turn is reflected in service exports. Tourism is still growing at a brisk pace. This together with the increase in fish catches is driving the current CLI rise.
Turning points of the CLI tend to precede turning points in economic activity relative to trend by approximately six months. Economic activity is measured by Gross Domestic Product (GDP) published by the Statistical Bureau of Iceland. The calculation of Analytica's CLI is based on methodology adopted by the OECD.
There are six components of Analytica's CLI. These are: Fish catches, inflation adjusted debit card turnover, number of tourists visiting Iceland, the MSCI World equities index, inflation adjusted imports and the Gallup Index of Consumer Confidence. For November four of the six underlying components are strengthening year on year. However, two of the six components rise on the previous month.
Table 1 shows the development of the CLI during the past twelve months. The value for November rises by 0.5 percent on the month to 101.6. This value serves as an indicator to economic activity six months into the future, i.e. May 2015. A value of 100 indicates GDP in line with its long term trend.
| Table 1. Analytica's CLI 2013-2014 | |||||
| Change in % | Indication | ||||
| Index | on month | YOY | for month | ||
| 2013 | |||||
| November | 101.7 | -0.1% | 0.9% | May 2014 | |
| December | 101.5 | -0.2% | 0.9% | June | |
| 2014 | |||||
| January | 101.3 | -0.2% | 0.7% | July | |
| February | 101.2 | -0.1% | 0.5% | August | |
| March | 101.3 | 0.0% | 0.3% | Sept. | |
| April | 101.2 | -0.1% | 0.1% | Oct. | |
| May | 101.0 | -0.2% | -0.1% | Nov. | |
| June | 100.8 | -0.2% | -0.4% | Dec. | |
| July | 100.5 | -0.2% | -0.7% | Jan. 2015 | |
| August | 100.5 | 0.0% | -0.9% | Feb. | |
| September | 100.7 | 0.2% | -0.9% | March | |
| October | 101.1 | 0.4% | -0.7% | April | |
| November | 101.6 | 0.5% | -0.1% | May | |
The December Composite Leading Indicator is scheduled for release on January 20, 2015.
Further information is provided by Analytica's CEO, Mr. Yngvi Hardarson
Tel. +354 5278890 - email: yngvi@analytica.is