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.

The CEIC Leading Indicator for India moderated to 110.5 in October 2020 from 112.1 in September. While the economy is recovering from the impact of the lockdown and dealing with the pandemic at the same time, many high-frequency indicators are showing moderation, reflecting the restoration of normalcy. Broadly, industrial production has witnessed an increase but there has been a slowdown in wholesale inflation and money supply. Electricity generation grew by 8.9% y/y and steel production rose by 1.1% y/y in October as opposed to increases of 4.8% y/y and 0.1% y/y, respectively, in September 2020. Crude steel production also increased by 0.2% y/y in October after declining by 2.9% y/y in September. On the other hand, money supply growth slowed down to 16.5% y/y after consistently registering increases of above 18% y/y for the previous three months. The wholesale food inflation also decelerated to 5.8% y/y in October from 6.9% y/y in September. In terms of consumer sentiment, passenger car sales sustained their upbeat trend, growing by 31.7% y/y in October after an increase of 16.2% y/y in September. This growth could be attributed to a low base effect, as well as the festive season sales.

The smoothed CEIC Leading Indicator continued to increase and reached 112.2 in October 2020, from 104.4 in September. The sustained rise in the smoothed indicator shows that the economy is recovering despite the moderation in the actual leading indicator.

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