Business Cycle INDEX KONSENS

Issue 3/2022 (August 19, 2022)

2nd Quarter 2022: Marked Economic Cool-Down 

KonSens (Q2, 2022), en.PNG

Graph Interactive Graph
Data File (XLSX) Archive
Method Paper  

After a sideward-movement beginning with mid-2021, a business cycle cool-down can be observed for Liechtenstein. The KonSens fell from slightly above 0 to −0.6 in the 2nd quarter of 2022. For the first time since the 2nd quarter of 2020, the index value turns negative, indicating economic growth below historical average. Liechtenstein’s economy is still quite robust in light of the worldwide down-turn. Yet, the negative international impact has inten-sified. The development in the current 3rd quarter is fragile and affected by energy prices and the interna-tional tightening of monetary policy to fight inflation. 

What is the KonSens?

The business cycle index KonSens by the Liechtenstein Institute is a quarterly, coincident composite indicator for Liechtenstein’s business cycle and consists of 16 individual economic indicators. It offers a timely aggregation of various – sometimes contradicting – business cycle signals to a consistent picture (with a publication lag of around 6 weeks). Applying various statistical methods, the KonSens generates for each quarter an indexed data point – adjusted for seasonal effects and with removal of the long-run growth trend – and shows whether real economic growth is above (boom) or below (recession) average since 1998. The Name KonSens originates from the conception of the «business cycle as a consensus» (Burns and Mitchell, 1946) of various individual economic impulses. But it is also the simple abbreviation of «Konjunktur-Sensor» (sensor of Liechtenstein's business cycle situation).

The KonSens focuses on the measurement of the state of Liechtenstein's business cycle, rather than on its determinants or influences. It represents a conceptual supplement to the ordinary focus on the Gross Domestic Product and is accessible on a timelier and more frequent basis than Liechtenstein’s annually published GDP. It allows an easy interpretation for policy, public administration, media, companies and general public and combines different data origins/dimensions to improve the data base for economic analyses. Doing so, it enables better reporting, monitoring and surveillance. The quarterly KonSens is regularly published in the middle of the subsequent quarter and is a module of the «Applied Economic Analysis», which is supported by Government of the Principality of Liechtenstein.

Contact

For further information (also in English), please contact: 

Dr. Andreas Brunhart, Head of Research Economics
andreas.brunhart(at)liechtenstein-institut.li

For quarterly news about KonSens updates please contact
info(at)liechtenstein-institut.li