OECD warns of a sharp slowdown in global growth

Leading indicators of Paris-based organisation all show declining activity

The global economy is still slowing, according to a new report from the Organisation for Economic Co-operation and Development, fuelling fears that countries such as the UK are heading back into recession.

The Paris-based organisation says that every country it monitors experienced a slowdown in economic activity during September, according to its composite of leading economic indicators (CLIs). "Compared to last month's assessment, the CLIs point more strongly to slowdowns in all major economies," the OECD said.

The latest survey shows the UK, France, Germany, Italy, Canada, China, India and Brazil all falling below their long-term trend (indicated by a CLI index reading of 100). The OECD's indicators anticipate turning points in economic activity relative to trend. A turnaround in an indicator tends to precede turning points in economic activity by about six months.

Howard Archer, the chief UK economist from IHS Global Insight, said that the latest OECD figures were particularly worrying news for the British economy. He said: "The further deterioration in the OECD leading indicator in September to be clearly below 100 ties in with mounting concern that the UK could be heading back into recession."

Japan, Russia and the US managed to stay above the long-term trend on the OECD's indicators. And there was some encouraging news from Japan yesterday as it registered GDP growth in the third quarter of 1.5 per cent, as production bounced back after March's tsunami and nuclear disaster.

But the Japanese economy minister, Motohisa Furukawa, warned that there are still potential future shocks looming for Japan. He said that policymakers need to "pay adequate attention to downside risks, such as possible deterioration in foreign economies, rapid appreciation in the yen and the impact of damage from the Thai floods".

And the depressing picture for Europe was reinforced by eurozone industrial production figures from Eurostat yesterday, which showed a 2 per cent fall in September on the previous month – the biggest monthly decline since September 2009. Overall, production of capital goods dropped by 4.2 per cent while output of durable consumer goods slid by 3.8 per cent, after rising in previous months. Energy production slipped by 1.4 per cent. Industrial production in Italy was down 4.8 per cent. In Portugal it was down 5.8 per cent and 2.9 per cent in Germany. Estonia registered a 10.9 per cent decline.

Elsewhere in Asia, Indian inflation remained broadly unchanged in September, at an uncomfortably high 9.73 per cent. This is the 11th straight month that year-on-year price increases have exceeded 9 per cent. High inflation limits the scope for the Indian central bank to cut policy rates and help the country cope with the economic disruption of the global slowdown. At the end of last month, the OECD slashed its 2012 growth estimate for the United States to 1.8 per cent from 3.1 per cent and cut its forecast for growth in the eurozone next year to 0.3 per cent from 2.0 per cent in May.

Suggested Topics
News
peopleFrankie Boyle responds to referendum result in characteristically offensive style
Sport
Lewis Hamilton will start the Singapore Grand Prix from pole, with Nico Rosberg second and Daniel Ricciardo third
F1... for floodlit Singapore Grand Prix
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvHe is only remaining member of original cast
Arts and Entertainment
tvHighs and lows of the cast's careers since 2004
PROMOTED VIDEO
Sport
Fans hold up a scarf at West Ham vs Liverpool
footballAfter Arsenal's clear victory, focus turns to West Ham vs Liverpool
New Articles
i100... she's just started school
News
news
News
ebooksAn unforgettable anthology of contemporary reportage
New Articles
i100
Life and Style
Couples have been having sex less in 2014, according to a new survey
life
Arts and Entertainment
musicBiographer Hunter Davies has collected nearly a hundred original manuscripts
Sport
football
New Articles
i100... despite rising prices
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam