Alfa Bank Launches Investor Confidence Index
02 Jun 2003
Alfa Bank has commissioned the creation of a new monthly Index intended to be a leading indicator of investor sentiment towards Russia. The "Alfa Bank Investor Confidence Index (AB-ICI)", which has been developed as a joint project between Alfa Bank and the New Economic School (NES) in Moscow, brings together a number of data series that track both portfolio and strategic investor sentiment and offer a strong guide to future investment intentions in terms of FDI, RDI and capital market flows.
The methodology used (see separate report inside) allows for the smoothing of "one-off" extreme observations so that the resulting Index is more even, reflecting long-term and medium-term fundamentals, and less prone to short-term changes in the underlying variables.
The AB-ICI is compiled using a number of key measures in the economy such as capital flows, currency markets, stock market performance, banking deposits and sector growth appropriately weighted to provide a highly useful indicator of investor confidence in the Russian economy.
In announcing the creation of the ICI, Alfa Bank President Peter Aven noted that there a number of exiting survey-based indicators published which rely on subjective perceptions of business managers and investors. "The Alfa Bank ICI removes the guesswork from these perceptions and provides business planners, economic planners, investors and analysts with a solid leading indicator of the changes in the economic environment. We are measuring not what economic actors are saying, but rather what they are doing."
"The future of the Russian economy will be determined in large part by investment flows, both foreign and domestic. With the ICI, a highly accurate leading indicator as shown by our studies, we will have a window on the behavior of the investors who will play a critical role in economic growth."
The AB-ICI will be published on a regular monthly basis starting from June 2003.
New Economic School (NES) is an independent graduate school of economics in Moscow established in 1992. The NES was founded as a partnership between the Central Economic Mathematics Institute of the Russian Academy of Sciences (CEMI) and the Hebrew University in Jerusalem, along with a group of Western economic professors. The Research Center at the NES was created in 1995 to encourage modern economics research in Russia.
Contact information
Natalya Orlova
Chief Economist
E-mail: norlova@alfabank.ru
Tel: +7 095 795 3677
Chris Weafer
Chief Strategist
E-mail: cweafer@alfabank.ru
Tel: +7 095 970 5081
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