A new weekly activity index (WAI) published by the Bundesbank is designed to measure real economic activity in Germany in a timely manner. Measured by the WAI, economic activity between 16 March and 14 June 2020 was 7.4% below the activity recorded between 16 December 2019 and 15 March 2020. If the growth rate of gross domestic product (GDP) is estimated on the basis of the WAI, it is 7.78% lower for the 13 weeks prior to 14 June compared with the preceding 13 weeks. This indicates that the coronavirus pandemic and the measures taken to contain it have caused the German economy to collapse since mid-March.

The WAI is an index calculated as a combination of indicators which are recorded on a weekly basis and are quickly available. It therefore cannot be equated with quarterly GDP. The WAI fluctuates around its long-term mean, which, due to the construction of the index (the data are standardised), is zero. As a result, positive values indicate above-average growth in real economic activity, while negative values signal a below-average increase or a decline in economic output. The WAI thus indicates the trend-adjusted growth rate of the economic activity it has measured over the past 13 weeks (e.g. the average of calendar week 14 to calendar week 26) compared with the 13 weeks before that (average of calendar week 1 to calendar week 13). The index is updated every Monday, with the periods under review shifting by one week each time. An estimate of GDP growth, which should be interpreted accordingly, can be derived from the WAI as a useful byproduct.

WAI includes indicators from various economic sectors

The indicators cover many different economic sectors and to display sufficient explanatory power in relation to economic activity. For example, electricity consumption and the daily truck toll mileage index capture the production sector and trade. The global number of flights creates a point of reference for global activity. The indicators derived from Google searches for the terms “unemployment”, “short-time work” and “state support” relate to the labour market or state aid measures. Pedestrian frequency on major shopping streets captures one part of consumer behaviour, whilst an index calculated from consumer surveys measures one part of consumer sentiment, and the air pollution variable (concentration of nitrogen dioxide in the air) serves as a metric for the mobility sector. Finally, monthly industrial output and quarterly GDP also feed into the WAI.