GSS: A record-breaking football transfer, the launch of a new boutique hotel. It may not be the spring of 2007, but green-shootists have plenty to feel good about at the moment.
That is reflected in a sudden acceleration in Breakingviews’ Green Shoots Spotter index of economic newsflow, which hit a survey high of 2.5 of out 5 last week. That is up from 2 the previous week and suggests a move towards a stabilisation of the economic situation.
The recovery is not just based on the revived investment appetite shown in big-spending business decisions, such as Real Madrid’s £80m purchase of football star Cristiano Ronaldo. An increasing number of authoritative voices are declaring that the downturn’s nadir has been reached. Nobel Prize-winning economist Paul Krugman suggested that this summer may mark the bottom for the US recession. Meanwhile, the IMF has raised its global growth forecasts.
But the backward-looking and snapshot macro-economic data remains much more bearish than the experts’ comments. The trough may be nearing, but we may be here for some time.
The GSS seeks to assess the direction of the economy by classifying economic, corporate and financial news from 1 ("still in real trouble") to 5 ("rapid recovery"). This week, 34 news items were included in the basket.
Associated with Christopher Hughes & Constantine Courcoulas