November OECD composite leading indicator – continues to slow

Posted on 20 January 2010

Momentum continues to flag in the OECD CLI (refer to leading indicators as buy/sell signals for equities):

Anecdotal consensus has the risks to the downside in equities markets emerging from the end of Q1 (or maybe Q2) when the impacts of the global government stimulus begin to wane. Certainly this view would fit rather neatly with the CLI itself rolling over towards the end of Q1.

Australia’s CLI while remaining stronger for longer is also starting to show the first signs of sagging momentum:

And crucially the major catalyst for our export performance is already testing the turn – though how this translates to commodity demand and prices is to be explored on another day.