The CEIC Leading Indicator is a proprietary dataset designed by CEIC Insights to precede the development of major macroeconomic indicators and predict the turning points of the economic cycle for key markets. It is a composite leading indicator which is calculated by aggregating and weighting selected leading indicators covering various important sectors of the economy, such as financial markets, the monetary sector, labour market, trade and industry. It is developed through a proprietary CEIC methodology and employs data from the CEIC database. The CEIC Leading Indicator currently covers eight regions – Brazil, China, India, Indonesia, Russia, the Euro Area, Japan and the United States.

In May 2020, the CEIC Leading Indicator for China continued to climb, reaching 110.4, above the economy's long-term trend and the highest reading since March 2017. The notable rise was mainly due to the surge in money supply and to the improved performance of the real estate and automotive sectors. May witnessed an 11.1% y / y growth of the M2 money supply, higher than expected and the highest since January 2017. Moreover, the volume of floor space sold in China increased by 10% y / y in May, the highest level in the past three years. Furthermore, China's automotive production rose to 2.18mn units, moving closer to the level before the outbreak of the COVID-19 pandemic. Since the outbreak of COVID-19 in China, the CEIC Leading Indicator for the country dropped to 78 in January and plunged to 62.7 in February, far below the long-term trend, showing the devastating impact of the virus on China. However, the leading indicator has since managed to recover over three consecutive months, climbing to 83.9, 103.3 and 110.4 in March, April and May, respectively, which suggests that if there are no disruptions such as a resurgence of the virus or floods, China's economy is expected to accelerate in Q3 2020.

The smoothed CEIC Leading Indicator for China also continued to increase, reaching 100.8 in May 2020, slightly above the economy's long-term trend over the whole 2019. It slipped to 85.6 in January and to 86.1 in February, the lowest level since 2015 but still higher than the trough during the 2008-2009 Great Recession. After the shock due to the COVID-19 pandemic, the smoothed leading indicator picked up growth momentum quickly, reaching levels of 89.5, 94.8 and 100.8, respectively, in March, April and May. This can be considered as a strong signal that the Chinese economy is getting back to normal at a relatively fast pace.

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