OECD LEIs Show Continuing Modest Expansion
The OECD overall gauge shows continued growth as the comprehensive index rises to a rounded up value of 100 in December from 99.9 in November and continues its one-tick per month advance that has been in play for the last three months. On the OECD gauges, the LEI index value of 100 is the demarcation line between normal and subpar growth. Subpar assessments are still in place for the U.K., the U.S., and China. Japan elevates above that morass of stagnation with a 100.1 reading while the EMU at 100.4 has slightly more breathing room. While the picture is one that signals growth, there are no modifiers of reassurance here: growth is not robust growth, it is modest growth and it is barely an improved reading after a long string of ongoing disappointing readings.
The OECD prefers to look at six-month changes in its indicators. Over six-month changes in the indicators from the countries/areas listed at the top of the table are showing gains. So the levels of the indices signal subpar growth, but the changes in the OECD LEIs signal that there is some acceleration in train. Still, that signal is quite muted as the six-month ratio is higher by 0.8% in China, by 0.6% in the U.K., by 0.5% in Japan, by 0.4% in the U.S., and by 0.3% in the EMU as well as for the OECD overall. None of these are rollicking signals of substantial acceleration. (…)
THE U.S. ECONOMY THROUGH BANK LENDING
- Banks are tightening consumer lending standards. This is rather rare and generally not bullish:
- Consumers are not showing much credit needs:
- Corporate demand remains tepid, if not falling…
For a credit-fuelled economy, no signs of acceleration in spite of the stronger PMI surveys.
OIL
Speaking of fuel, U.S. oil demand is also not strong: (charts on oil via the Daily Shot, Bespoke and Doug Short)
SENTIMENT WATCH
The percentage of investors who are bullish is now above the highs we’ve seen in October of 2007. (The Daily Shot)
