Australian Wool Innovation Limited conveyed that OECD December 2005 data showed improved or accelerating performance in five of the seven major economies in the OECD, with the most positive signals in Canada and the US.
For Japan, the leading indicator rose for the eighth month in a row.
The OECD leading indicator continues to point to an expected improvement in economic conditions in the Euro region for much of 2006.
However, this improvement is being driven by France and Germany, with the indicator showing no expected pick-up in economic activity for Italy.
For the UK, similar to Italy, economic activity as forecast by this indicator is expected to remain subdued.
Overall, the latest data from the OECD indicates that several of the key retail markets for wool are expected to record an improvement in economic activity in the next six to nine months, which should help underpin employment and retail spending and add weight to the prospect that the recent improvement in greasy wool prices will be further supported by market fundamentals.
In particular, one of the key differences from recent years is what appears to be on-going improvement in Japan, which could provide a major stimulus for raw wool demand given it is the second largest consumer market for apparel wool.
Australian Wool Innovation Limited
marketing@alchempro.com
