The assessment here is that the global economy has been gaining momentum since mid-year and growth over the next six to 12 months will be significantly stronger than expected by policy-makers and the consensus. This series of short posts will highlight incoming evidence that supports, or refutes, this view.
The OECD yesterday released August data for its country leading indicators, allowing calculation of the composite G7 plus emerging E7 leading indicator tracked here. Six-month growth of the latter rose further – see first chart. Both G7 and E7 components contributed to the increase – second chart.
The rise in leading indicator growth from a low in December 2015 follows a pick-up in G7 plus E7 six-month real narrow money expansion from a bottom in August 2015. The further increase in real money growth to a seven-year high in August 2016 suggests that the indicator will continue to gain momentum.
