Businesses downgraded their optimistic views for performance outlook – NBU

In October 2021, businesses downgraded their positive views about their economic outlook.

This is evidenced by the business activity expectations index (BAEI), which the National Bank of Ukraine (NBU) calculates on a monthly basis, Ukrinform reports.

In particular, the index amounted to 51.4 in October 2021, compared with 53.1 in September 2021.

It is noted that  robust  consumer demand and investment activity continued to have a positive effect on respondents’ expectations, higher energy prices, an increase in COVID-19 cases, and stricter quarantine restrictions imposed in Ukraine and globally weakened companies’ positive views.

“Trading companies continued to express the most optimistic views about their performance outlook, as the sector’s index moved to 52.2 in October, down from 56.1 in September. Respondents somewhat downgraded their positive expectations of trade turnover and the amount of goods purchased for sale,” the report says.

Industrial companies have positively assessed the economic results and prospects of their activities for the sixth month in a row. However, estimates in October (51.1) were lower than in September (52.8). Compared to the previous month, respondents reported more guarded expectations of an increase in the amount of manufactured goods and the number of new orders for products, including export orders. 

Services companies are also optimistic about their performance outlook, the sector’s index being 51.3 in October, down from 51.8 in September. Respondents continue to expect an increase in the volume of services provided and new orders.

“Construction companies had the most restrained expectations of their performance outlook, the sector’s DI being 50.2 in October, down from 51.6 in September. Construction companies upgraded their expectations of construction work done and the number of new orders,” reads the report.

The survey was conducted between October 4 and October 23, 2021 among 341 companies. Out of the companies polled, 44.9% are industrial companies, 30.2% companies in the services sector, 21.1% trading companies, and 3.8% construction companies.