Data indicates that largest global economies poised for sputtering activity
A top European economic think tank predicts that the world's largest economies -- and several large developing ones -- are heading for anemic growth and continued fiscal malaise.
According to the
The OECD's Composite Leading Indicator sets a score of 100 as the long-term average trend for a given country's economic activity. Changes in direction for the indicator show turning points in an economy, and can indicate a shift from a growing economy to a declining one.
Of the organization's "major seven" countries, including
In addition, of the so-called "BRIC" (
The CLI fell for all four BRICs and all "major seven" countries in September, indicating that all are headed for slowdowns.
This does not necessarily mean that these countries are headed for negative growth, but it could mean that they are losing their economic momentum, experts say.
It's important to remember that this is only a snapshot in time, says
"Of course, if policy measures are implemented after the CLI has been put in place, for example if you see a large injection of cash injected into an economy that's intended to boost the economy in a sort of Keynesian way, then of course we will have to change our assessment," he says.
But reports indicate cash-strapped countries poised on the brink of austerity measures, like
Countries in the OECD foresee a difficult slog back to recovery. Indeed, officials in
Experts see this slowdown as a potential symptom of globalization -- a drag on one country's economy is now a drag on many countries.
"Basically what you're seeing here in many of the countries is a contagion effect -- all of these countries are very connected in terms of their production processes, and the spillover from one will hit another," says Ahmad.
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