August 2023 estimations

The KEPE monthly Composite Leading Indicator (CLI) is constructed based on a dynamic factor model, using six selected monthly economic series assumed to have leading properties (see also Tsouma, E. [2016], Constructing a Composite Leading Indicator of Economic Activity in Greece, Applied Economics Quarterly, 62 [2], 85-105). It provides early evidence on the course of and any turns in Greek economic activity, ahead of the developments in major economic aggregates. According to the most recent observation for May 2023, the CLI continues to increase, reaching a new maximum level for the total period of investigation. The respective development is an extension of the overall rising course of the CLI from 2020 onwards. On these grounds, it is assumed to reflect the enhancement of positive expectations and assessments by agents involved in economic activity, offering leading indications for an improvement of economic conditions. At the same time, it indicates that developments in inflation and interest rates are not having an adverse impact. In any case, it remains necessary to re-estimate the CLI, with the aim to acquire additional evidence, since the inclusion of new data is expected to demonstrate the continuation or interruption of the observed trends regarding the course of future domestic economic activity.

Notes: The lag in the data is associated with the non-availability of more recent data for building activity.