Global Barometers are relatively stable in December

After falling sharply throughout the second half of 2021, the Global Economic Barometers were relatively stable in December. The Coincident Barometer interrupted the sequence of decline started in July, while the Antecedent Barometer ed the seventh consecutive fall, remaining below 100 points, which exposes the difficulties in maintaining the pace of recovery of the world economy.

The information comes from the Brazilian Institute of Economics of the Getulio Vargas Foundation (Ibre/FGV), released today (10).

While the Coincident Barometer reflects the current state of economic activity, the Antecedents Barometer gives a cyclical signal about six months ahead of actual economic developments. These indicators are based on the results of economic trends surveys conducted in more than 50 countries. The intention is to have the widest possible global coverage.

The Coincident Global Economic Barometer rose 0.5 points in December to 107.1 points. The Antecedents Global Economic Barometer retreated 0.4 points, to 95.7 points, the lowest level since July 2020 (83.2 pts.).

According to the analysis, the positive result of the Coincident Barometer was determined exclusively by the European region, while the negative result of the Background Barometer was influenced by Asia, Pacific and Africa and by the Western Hemisphere.

According to the researcher from Ibre/FGV, Paulo Picchetti, while the advance of the Coincident Barometer demonstrates stability in the level of activity in most regions at the end of 2021, the new negative result for the Antecedent Barometer incorporates the effects of increased uncertainty in relation to to the immediate future.

“Despite the extent of the threat posed by the new variant of the new coronavirus is not yet fully known, new restrictions on mobility are already being adopted in some places. This fact may delay the solution of problems in the input supply chains, whose pressures on prices are already widespread, resulting in signs of contractionary monetary policy in several countries”, said, in a note, the researcher.

Coincident Barometer

Europe is the only region to a positive evolution of its coincident indicator in December. The indicators for the other regions were stable. All regions still indicators above the historical average level of 100 points.

Among the sectorial indicators, only Industry and Commerce rose in December, while the others ed a fall. As a result, the Trade indicator became the highest among the sectorial indicators, something that had not happened since October 2019.

Background Barometer

The Background Global Barometer anticipates cycles of world growth rates by three to six months. The leading indicators for the Asia, Pacific and Africa and Western Hemisphere regions contributed negatively to the evolution of the Antecedents Barometer (-0.4 points) by 0.5 and 0.4 points, respectively. Europe was the only region to contribute positively, by 0.5 point. All regions ed leading indicators below 100 points in December.

There was a drop in three of the five leading sector indicators in December: Services, Construction and Industry. The Trade and General Economy indicators (assessments by consumers and business aggregates) rose in the month. With the results, commerce continues to be the most optimistic sector in the short term, construction and services a level that reflects moderation and industry and economic indicators are below the historical average of 100 points, signaling a weakening trend.

Text translated using artificial intelligence.

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