Thursday, 28 October 2010

Bureau for Investments and Economic Cycles

I recently came across the website of BIEC, which publishes analyses of Polish economic trends. There are many companies that produce such information, but I particularly like the long term trends shown on the graphics. The latest release shows the Market Conditions Index, which seems to be based on leading cyclical economic indicators. This remained stable for October 2010, the third month in a row.

What I particularly like about the presentation is the long-term perspective, with the information for this index going back to 1994, as below. (The image is taken straight from the website without permission, but I hope they don't mind me using it to advertise them.)

The index information, covering roughly two economic cycles, is fascinating in itself, with the 2008/2009 downturn merely a return to long term (from 1994) trend growth levels. The current level seems to be on the 2001-2005 trend line, with 2005-2007 being an abnormal growth period away from longer term trend, with the subsequent correction being seen from the graph to as having been a stabilising, rather than negative phenomenon. It will, of course be interesting to see the extent to which that 'abnormality' might feed into a longer term pattern, but there is no hint of that at the moment. Even without this, consistent trend growth over the period is absolutely clear. So, given the severity of the world recession and its inevitable negative impact on Polish growth, the long-term pattern of continuous growth seems inevitable, with any variation likely to be on the upside.

The information on the site is in Polish, but Google Translate works well - I have the browser button set up on Firefox, which stops me even having to think about the Polish.

No comments: