The IMF has now confirmed that the world economy has moved into the synchronised slowdown that I forecast here a year ago. Its analysis also confirms the importance of the issues highlighted then, including “rising trade barriers and increasing geopolitical tensions”, a sharp decline in manufacturing, contraction in the auto industry and structural forces such […]
Chemicals and the Economy
Markets remain “volatile and challenging” says BASF chairman
Nothing has really changed over the past year. That seems to be the key conclusion from the blog’s quarterly summary of company results for Q1. A year ago, BASF noted that “achieving our earnings target is significantly more challenging today than we had expected”. This month, chairman Kurt Bock “warned the markets will remain volatile and […]
Policymakers’ faith in US Confidence Index badly misplaced
There was an interesting discussion at our annual conference last week about the relevance of correlation statistics. The general view was that anything less than 90% wasn’t really worth bothering about, as the number of errors would be too great. Thus the blog was very amused to see Neil Irwin in the Washington Post writing […]
OECD Indicators show economic slowdown underway
The latest American Chemistry Council (ACC) weekly report has worrying evidence that the global economy may be at a turning point, as stimulus programmes are replaced by austerity. The chart shows the latest leading indicators from the OECD (Organisation for Economic Co-operation and Development). As the ACC warn: “The CLI (green line, Composite Leading Indicator) […]
Shipping index signals China slowdown
The blog’s recent visit to Singapore included several discussions about the slow start to the New Year in China. And these concerns were confirmed last week in the downturn reported by the OECD’s leading indicators for China (Organisation for Economic Co-Operation and Development). Separately, as the chart shows, the Baltic Dry Index of ocean freight […]
China forecasts 20% property price drop in 2011
China’s government tends not to like surprises. Its usual tactic is therefore to talk about policy changes well in advance. And this is what seems to be happening with regard to the real estate bubble. Back in September, premier Wen Jiabao said it would probably take 2 – 3 years to cool the bubble properly. […]
“A real global downturn in the industrial sector”
There are mounting signs that 2010 could prove a Year of 2 Halves in terms of economic growth. Interviewed by Bloomberg last month, the MD of the Economic Cycle Research Institute (ECRI), Lakshman Achuthan, warned that their indicators showed “A real global downturn in the industrial sector is starting right here and right now“. They […]
Key US indicator signals downturn may resume in H2
Stock markets have always been somewhat unreliable as a forecasting tool. And their record has got worse in recent years, as long-term investors have been replaced by high-speed day traders. In turn, this affects the Leading Indicators produced by the OECD, and others, as these rely on stock price movements in their analysis. A more […]
Growth slowdown underway
The OECD produces useful leading indicators each month, which try to capture turning points in the global economy. Its industrial production indicator is very relevant to chemicals, as 85% of demand comes from this sector. The latest outlook is summarised in Kevin Swift’s ACC report. The blue line is actual global industrial production, whilst the […]
The end of the prologue
The report in today’s ‘Financial Times’ that Barclays Bank has lost ‘several hundred million dollars’, means that the UK has now joined every other global financial centre in suffering from the US subprime mortgage crisis. The news followed Friday’s 5% drop in the value of Bank of China’s shares, after it revealed it held $9.7bn […]
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