Eurocoin indicator falls slightly in January, expansion confirmed

The €-coin indicator, developed by Banca d'Italia and published monthly in collaboration with CEPR, provides a summary index of the current economic situation in the euro area.

It serves as an estimate of quarterly GDP growth, shorn of the most erratic components such as seasonal variations, measurement errors, and short-run volatility.

The indicator's slight fall to 0.49 in January from 0.52 in December reflects a softening of positive signals in the service sector, as reported by recent qualitative surveys.

Despite this minor dip, the overall performance of the €-coin confirms the ongoing phase of cyclical expansion within the euro area, suggesting continued underlying economic strength.

The €-coin is constructed monthly by exploiting a vast set of macroeconomic time series.

These include industrial production indices, business and household surveys, demand indicators, and stock market indices.

This comprehensive data set allows the indicator to extract the underlying trend of euro-area GDP growth.

Crucially, €-coin precedes the official euro-area GDP figures released by Eurostat by several months, offering an early indication of the economic trend net of any erratic or short-term components.

This makes it a valuable tool for real-time economic assessment.