OECD sees developed economies gaining momentum

PARIS (REUTERS) - Developed countries are gaining economic momentum while growth in major emerging market economies slows, the OECD said on Monday, flagging a diverging trend.

The Paris-based Organisation for Economic Cooperation and Development said its latest monthly composite leading indicator (CLI) as a whole rose to 100.6 in May from 100.5 in April.

The slight improvement brought the measure, which covers 33 OECD member states and is designed to indicate turning points in economic activity, further above the long-term average of 100.

"The CLIs point to moderate improvements in growth in most major OECD economies but in large emerging economies the CLIs point towards stabilising or slowing momentum," the organisation said in a statement.

Japan, benefiting from a massive round of monetary stimulus, led the way among developed countries with a reading of 101.3, up from 101.1 in April.

The U.S. reading was unchanged in May at 101.0, which the OECD said signalled firming growth, as the U.S. Federal Reserve considers whether to wind down its stimulus programme.

Even the euro zone, long struggling to emerge from a debt crisis, saw momentum building with its reading rising to 100.3 from 100.1. The OECD highlighted a change of trend in Italy, whose reading also rose to 100.3 from 100.1, after months of dire recession.

The trend was less encouraging in emerging economies. China lost further speed with a reading of 99.5, down from 99.6.

Brazil's index slowed even further to 99.1 from 99.3 while Russia's reading fell to 98.9 from 99.2, which in both cases the OECD was consistent with losing economic momentum.

Alone among the major emerging market countries, India saw its index rise to 97.6 from 97.5, which the OECD said was indicative of a tentative upward change in the trend.