Business cycle survey (in entreprises of industry, construction, etc.) - September

Confidence in domestic economy increased in September. The composite confidence indicator (economic sentiment indicator) increased by 2.7 points m-o-m, due to increasing confidence of both consumers and entrepreneurs. Among entrepreneurs, confidence increased most in industry. Compared to September 2008, the composite confidence indicator was 17.5 points down.




Business confidence indicator increased by 2.1 points in September compared to August. Among entrepreneurs, the most marked increase of confidence was recorded in industry; confidence in selected services increased slightly, in trade a moderate decrease was recorded and in construction the confidence dropped. Compared to September 2008, the confidence of entrepreneurs is 20 points down.

In industry, the assessment of current overall economic situation in September increased moderately compared to August. Assessment of total and external demand increased, too. According to respondents, stocks increased slightly. For the next three months respondents’ expectations regarding production activity and employment are more favourable than in August. For the period of the next three months expectations of general economic situation are higher than in August, for the period of the next six months they are the same. Overall, in September, the confidence in industry increased for the seventh time in a row (by 4 points), m-o-m; but it is 12 points down, y-o-y.

In construction, the assessment of current economic situation in September increased compared to August. Despite a slight m-o-m increase, the assessment of current total demand remains low. For the period of the next three months respondents expect a slowdown in the development of construction activity and count on decrease in employment, compared to August. Respondents estimate that they have work secured by contracts for 8.3 months ahead. Expectations of the economic situation development for the period of the next three as well as six months are lower than in August. Overall, the confidence in construction decreased by 1 point, m-o-m, and it is 35.5 points down, y-o-y.

In trade, assessment of current economic situation in September decreased, compared to August. Expectations of the economic situation development for the period of the next three as well as six months are, however, higher than in August. According to respondents, in September, the finished goods stocks did not change. Overall, the confidence in trade decreased slightly (by 0.3 point) m-o-m, and it is 20.3 points down, y-o-y.

In selected services, according to respondents, the assessment of current economic situation decreased in September compared to August. The assessment of demand increased moderately and so did its expectations for the next three months. For the period of the next three months expectations of total economic situation are higher than in August, for the period of the next six months they are the same. Overall, the confidence in selected services increased a little (by 0.3 point), compared to August; while in the y-o-y comparison it is 28 points down.

Consumer confidence indicator increased by 5.3 points, m-o-m, to fall by 7.7 points, y-o-y. The survey taken among consumers in September indicates that, compared to August, consumers expect for the next twelve months an increase in the overall economic situation as well as a moderate improvement in their own financial standing. The share of respondents expecting further rises in unemployment decreased substantially, compared to August; most respondents count on its moderate increase or no changes. The percentage of respondents planning to save money increased.

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Note

Contact: Marie Hörmannová, phone (+420) 274052049, e-mail: marie.hormannova@csu.gov.cz
Data source: CZSO business survey, GfK Praha consumer survey
Business and Consumers Surveys are co-financed by grant agreements of the European Commission DG ECFIN
End of data collection: 21 September 2009
End of data processing: 24 September 2009
Related publication: 1201-09 Business Cycle Survey in Enterprises of Industry, Construction, Trade and Selected Services

(Publications available also at /1-ep-1 )



Methodological explanatory notes :

Since January 2009, the balance of consumer confidence indicator is seasonally adjusted. Time series of consumer and composite confidence indicators are recalculated back and the data are comparable.

Since January 2006, the composite confidence indicator (economic sentiment indicator) is in compliance with the EU methodology presented as a weighted average of seasonally adjusted confidence indicators in industry, construction, trade, selected services and seasonally non-adjusted consumer confidence indicator. Composite business confidence indicator is a weighted average of seasonally adjusted confidence indicators in industry, construction, trade and selected services.

Since January 2006, due to the inclusion of confidence indicator in selected services, a new weighting system has been used : confidence indicator in industry is assigned the weight of 40%, in construction and trade 5% each, in services 30%, and consumer confidence indicator is assigned the weight of 20%. Indicators are presented as basic indices, the base being the average of 2005.

Time series of composite and business confidence indicator are recalculated, using the new weighting system – back to May 2002 (the beginning of the business cycle survey in selected services). The whole time series of base indices are then re-based to the average of 2005; the data are comparable.