China’s economic slowdown may be set to end this year, with Brazil also heading for a stabilization, according to leading indicators released Monday by the Organization for Economic Cooperation and Development.
The Paris-based research body said its gauges of future economic activity — which are based on information available for November — continue to point to slowdowns in the U.S., the U.K. and Russia, steady growth in the eurozone, Canada and Japan and an acceleration in India.
The leading indicators for China suggest the world’s second-largest economy will avoid a sharper slowdown in economic growth and the “hard landing” feared by policymakers, investors and businesses.
China’s economy grew 6.9 percent in the third quarter last year, its slowest pace since the global financial crisis. But more recently released surveys and other evidence point to a further easing of growth in the final months of 2015, sparking sharp falls in Chinese equity markets that have contributed to falls in asset prices around the world.
The OECD said its leading indicator for the world’s second-largest economy rose to 98.4 in November from 98.3 in October, its second straight month of increase, pointing to “tentative signs of stabilization.”
The OECD’s leading indicators are designed to provide early signals of turning points between the expansion and slowdown of economic activity, and are based on a variety of data series that have a history of anticipating swings in future economic activity. The changes in economic activity signaled by the indicators usually follow six to nine months after they are recorded, suggesting Chinese growth may stabilize before the middle of this year.
Taken as a whole, the indicators suggest the global economy is unlikely to pick up significantly in the early part of 2016, with only India and France set for an acceleration.
The OECD’s composite leading indicator for its 34 members was unchanged at 99.8. A reading below 100.0 points to growth that is slower than normal.
