The Composite Leading Indicator of the Moldovan Economy and Current Economic Trends

The Independent Think Tank “Expert-Grup” has developed the Composite Leading Indicator, which was presented at a round table on 26 April. One of the main lessons of the 2009 economic crisis was the need to improve the capacity of the relevant public authorities to anticipate, prevent and manage possible negative trends in the national economy. The CLI of the Moldovan economy makes it possible to anticipate short-term fluctuations, based on a set of carefully selected variables that have the property of preceding variations in the economic cycle. Thus, the CLI can serve as an important analytical tool for decision-makers, to understand more accurately the direction in which the Moldovan economy is moving and to prevent possible negative trends.

The round table also presented the monthly publication No. 27 of “Economic Reality”, which identifies and analyses the most important political and economic developments since the beginning of this year. According to the data, the CLI continued its downward trend during February, bringing some signs of a slowdown in the growth of the Moldovan economy, which may continue in the coming months if the regional situation does not improve. A trend of significant cooling in the growth rates of the main economic indicators emerged in the first months of 2012, some of them even being in decline compared with the previous year. A recession in industrial production has already been observed for three months, agriculture has stagnated, remaining at the previous year’s level, and the transport sector points to the continuation of these negative trends. The main causes are the cooling of external and domestic demand. Thus, after months of concern about the potential evolution of exports, February confirmed our fears, as exports declined, mainly to EU countries. The EU’s immediate economic prospects are still uncertain, with the IMF’s recent economic growth forecasts revised downwards. Domestic demand will also no longer have its previous momentum, given the slowing growth of remittances and the immediate decline in household deposits.

For more data and details on the importance of the Composite Leading Indicator and on current economic trends, please consult the available analytical materials. The event was attended by representatives of line ministries, banks, economic advisers of embassies, economic analysts and the media.

This event is organised by the Independent Think Tank “Expert-Grup” with financial support from the Think Tank Fund of the Open Society Institute in Budapest, Hungary.