The Global Barometers record a decline, but overall they are still in line with the tendency towards relative stability observed over the course of this year. The decline brings the Leading Barometer closer to the neutral level of 100 points, while the Coincident Barometer is moving away from this band.
The Coincident Global Economic Barometer decreases 2.3 points in September, to 91.5 points, its lowest level since November 2023 (90.5 pts), while the Leading Barometer loses 2.6 points, to reach 100.6 points. The fall in the Coincident Barometer was entirely driven by the result of the Asia, Pacific & Africa region, whereas the result of the Leading Barometer was driven by the three surveyed regions.
“Although both global indicators show a decline this month, it can still be said that both have generally been relatively flat for more than a year. The leading indicator remains in much better shape than the coincident indicator, suggesting that hopes for an improvement in the subdued situation remain alive. Only the Asia-Pacific and Africa regions continue to deteriorate slowly, while Europe and the Western Hemisphere largely offset this development”, evaluates Jan-Egbert Sturm, Director of KOF Swiss Economic Institute.
Coincident Barometer – regions and sectors
The fall in the Coincident Barometer in September is the result of the 2.5-point negative contribution of the Asia, Pacific & Africa region, while the contributions from Europe and the Western Hemisphere were barely noticeably positive with 0.1 points each. With this result, the indicator for the Asia, Pacific & Africa region moves further away from the other regions and reinforces the slowdown in the region in 2024. While the Asia, Pacific & Africa region records accumulated losses of 6.0 points for the year, Europe and the Western Hemisphere accumulate gains of 6.4 and 4.5 points, respectively.
The development of the Coincident sector indicators in September is varied, with some sectors showing positive results and others negative tendencies. Industry, Economy (aggregated business and consumer evaluations), and Construction decrease this month, while Services and Trade move in the opposite direction.
Leading Barometer – regions and sectors
The Leading Global Barometer leads the world economic growth rate cycle by three to six months on average. In September, all the regions contribute negatively to the aggregate result with -1.0, -0.9, and -0.7 points for the Western Hemisphere, the Asia, Pacific & Africa region, and Europe, respectively. The lukewarm result since the second quarter of the year is spread across the three regions, and its continuity also signals weak growth in world economic activity for the second semester of 2024.
In September, all the Leading sector indicators decrease, with the exception of Trade, which gains 2.9 points and remains at the highest level among the sectors.