The March update of the global LEI chartbook confirms that a broad-based upturn in global cyclical activity has been underway since the end of the third quarter of last year. However, the data show hints of weakness at the end of Q1, with the number of positive LEIs sitting at 14 out of 20—unchanged from a downwardly revised level in February and below the average of 16 recorded between September and January. This deterioration comes before leading indicators have had to contend with the chaos wrought by the war in Iran and disruptions to energy and commodity flows through the Strait of Hormuz and, more broadly, across the Middle East.
Read MoreThe February update of the global LEI chartbook confirms that a broad-based upturn in global cyclical activity has been underway since the end of the third quarter last year. Granted, the number of LEIs currently in expansion—16—is slightly lower than at previous cyclical peaks. However, the February update and revisions point to a stabilising expansion at this rate, which remains robust overall.
The big question now is whether the upturn will falter in the face of the energy price shock ignited by the war in Iran.
Time will tell.
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