KEPE’s composite leading indicator of Greek economic activity (CLI-GR)

The monthly Composite Leading Indicator (CLI) of KEPE is constructed on the basis of a dynamic factor model, using selected monthly indicators assumed to have leading properties. It provides early evidence of turns in Greek economic activity ahead of the corresponding turns in aggregate measures. According to the most recent observation for April 2019, the CLI records once again an increase, for the fourth consecutive period. Remaining on a rising course, the Indicator now approaches the highest levels, since the onset of the economic crisis, that have been recorded during the more recent period, namely in the months of July and August 2018. Despite the frequently recorded intermediate variability of the CLI, its recent path does not include solely intermediate positive observations. In contrast, the related increase seems to signal that the downward adjusting course, which begun in September 2018, has finally come to an end. As a result, the observed recovery of the CLI could constitute an early indication of a future enhancement of the stabilizing and improving trends in economic activity in the country, at least in the short-run, on the basis of its leading feature. For a better and more accurate assessment regarding the continuation or interruption of the prevailing trends, it is necessary to re-estimate the CLI with all the available information as soon as new data are published.