REYKJAVIK, Iceland, July 19, 2016 (GLOBE NEWSWIRE) -- The Analytica Composite Leading Indicator (CLI) for Iceland remained unchanged in June. However, there were some downward revisions for the months of March through May. The CLI indicates growth above long term trend.
Two of the six components rise on the previous month, i.e. merchandise imports and the value of fish catches. The remaining components contract. All the components are adjusted for seasonal variation and long term trend. The largest impact is due to diminishing expectations and the lower price of equities. It is of particular interest that an upward revision in the long term trend estimate results in a downward revision of the CLI. The main risk factors to the still positive outlook continue to include some external factors mainly in relation to the geopolitical situation and growth prospects for emerging markets and China.
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 five 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 remains unchanged at 102.3. This value serves as an indicator to economic activity six months into the future, i.e. December 2016. A value of 100 indicates GDP in line with its long term trend.
| Table 1. Analytica's CLI 2015-2016 | |||||||||||
| Change in % | Indication | ||||||||||
| Index | on month | YOY | for month | ||||||||
| 2015 | |||||||||||
| June | 100.3 | 0.2 | % | 0.5 | % | Dec. | |||||
| July | 100.6 | 0.4 | % | 1.2 | % | Jan. 2016 | |||||
| August | 101.0 | 0.4 | % | 1.8 | % | Feb. | |||||
| September | 101.2 | 0.2 | % | 2.1 | % | March | |||||
| October | 101.4 | 0.2 | % | 2.2 | % | April | |||||
| November | 101.7 | 0.3 | % | 2.3 | % | May | |||||
| December | 102.0 | 0.3 | % | 2.4 | % | June | |||||
| 2016 | |||||||||||
| January | 102.2 | 0.2 | % | 2.4 | % | July | |||||
| February | 102.4 | 0.2 | % | 2.3 | % | August | |||||
| March | 102.4 | 0.0 | % | 2.3 | % | Sept. | |||||
| April | 102.3 | -0.1 | % | 2.3 | % | Oct. | |||||
| May | 102.3 | 0.0 | % | 2.2 | % | Nov. | |||||
| June | 102.3 | 0.0 | % | 2.0 | % | Dec. | |||||
The July Composite Leading Indicator is scheduled for release on August 17, 2016.
Further information is provided by Analytica’s CEO, Mr. Yngvi Hardarson
Tel. +354 5278890 - email: yngvi@analytica.is