The latest data on leading economic indicators from the Organisation for Economic Co-operation and Development (OECD) point to stable growth in the major advanced economies as a whole. The new leading indicators data, which were released a week ago, suggest that there will be stable growth in the Euro area as a whole, including Germany and France. There are also signs of growth stabilisation emerging in Japan. However, the leading indicators continue to suggest easing growth in the United States, the United Kingdom and Italy. The good news is that the outlook has improved in China and India since last month’s assessment. In the past, the turning points in the OECD leading indicators have been a useful guide to what may happen to wool prices, particularly in US$ terms. Analysis of the trends in the Composite Leading Indicators (CLI) for the major advanced wool consuming countries (the US, Japan, Italy, France, Germany and the UK) and for China, suggest that for a period in 2014 and the first half of 2015, the wool prices in US$ seemed to mirror the decline in the Leading Indicators for China. In the past 12 months, prices seem more in line with the upwards trend in the Leading Indicators for the advanced economies. With the Leading Indicators for both the advanced economies and for China starting to stabilise, we may see prices in US$ stabilise.

Full details including a chart of the trends in the Leading Indicators and wool prices are available in this week's NCWSBA Weekly Newsletter. Available to NCWSBA members.