REYKJAVIK, Iceland, July 20, 2015 (GLOBE NEWSWIRE) -- The Iceland Composite Leading Indicator (CLI) rose by 0.2 percent for the month of June following a rise of a revised 0.1 percent in May. The value of the indicator in upswing has not been higher since 2006. The CLI still indicates growth above long term trend.
The rise of the June CLI can be attributed to growth in domestic debit card turnover and an increase in the value of fish catches. There continue to be indications of healthy growth in domestic demand and a strong growth in tourist arrivals. The main risk factors to the still positive outlook include some external factors mainly in relation to the geopolitical situation. Also, the full impact of the recently concluded strikes is still unclear.
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 June all 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 June rises by 0.2 percent on the month to 101.8. This value serves as an indicator to economic activity six months into the future, i.e. December 2015. A value of 100 indicates GDP in line with its long term trend.
| Table 1. Analytica's CLI 2014-2015 | |||||||||
| Change in % | Indication | ||||||||
| Index | on month | YOY | for month | ||||||
| 2014 | |||||||||
| June | 100.5 | -0.2 | % | -0.5 | % | Dec. | |||
| July | 100.2 | -0.3 | % | -0.9 | % | Jan. 2015 | |||
| August | 100.1 | -0.1 | % | -1.2 | % | Feb. | |||
| September | 100.2 | 0.1 | % | -1.3 | % | March | |||
| October | 100.4 | 0.2 | % | -1.1 | % | April | |||
| November | 100.7 | 0.3 | % | -0.8 | % | May | |||
| December | 100.9 | 0.3 | % | -0.3 | % | June | |||
| 2015 | |||||||||
| January | 101.2 | 0.3 | % | 0.2 | % | July | |||
| February | 101.4 | 0.2 | % | 0.5 | % | August | |||
| March | 101.5 | 0.1 | % | 0.6 | % | Sept. | |||
| April | 101.5 | 0.0 | % | 0.7 | % | Oct. | |||
| May | 101.6 | 0.1 | % | 0.9 | % | Nov. | |||
| June | 101.8 | 0.2 | % | 1.3 | % | Dec. | |||
The July Composite Leading Indicator is scheduled for release on August 18, 2015.
Further information is provided by Analytica’s CEO, Mr. Yngvi Hardarson
Tel. +354 5278890 - email: yngvi@analytica.is