Iceland Leading Indicator - Positive Momentum

        Print
| Source: Analytica

REYKJAVIK, Iceland, June 23, 2014 (GLOBE NEWSWIRE) -- The Iceland Composite Leading Indicator (CLI) dropped slightly in May. The indicator published by independent advisory company Analytica, is designed to anticipate turning-points in economic activity relative to trend. The dip in May is not viewed as a significant change for the growth prospects in the months ahead.

First quarter GDP fell on the previous year according to preliminary statistics issued by the Statistical Bureau of Iceland earlier this month. However, recent movements in the CLI indicate that the drop can be expected to be of a very short term nature.

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 May four of the six underlying components are strengthening year on year. However, three 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 May rises by 0.1 percent on the month to 102.1. This value serves as an indicator to economic activity six months into the future, i.e. November. 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        
 May 101.4 -0.1% 0.0% Nov.
 June 101.2 -0.1% -0.4% Dec.
 July 101.3 0.1% -0.6% Jan. 2014
 August 101.6 0.2% -0.4% Feb.
 September 101.9 0.3% 0.0% March
 October 102.0 0.2% 0.5% April
 November 102.0 0.0% 0.8% May
 December 101.9 -0.1% 0.9% June
2014        
 January 101.9 0.0% 0.8% July
 February 102.0 0.1% 0.7% August
 March 102.2 0.2% 0.7% Sept.
 April 102.2 0.0% 0.7% Oct.
 May 102.1 -0.1% 0.8% Nov.

The June Composite Leading Indicator is scheduled for release on July 23, 2014.

Further information is provided by Analytica's CEO, Mr. Yngvi Hardarson
Tel. +354 5278890 - email: yngvi@analytica.is