30.01.2023

Cautious Improvement in Economic Assessments at the Beginning of the Year

Results of the WIFO-Konjunkturtest (Business Cycle Survey) of January 2023

The results of the WIFO-Konjunkturtest (business cycle survey) show a further slight improvement in economic assessments in January. At 6.4 points (seasonally adjusted), the WIFO Business Climate Index was 0.7 points above the value of the previous month (5.7 points). The increase is primarily due to the improvement in situation assessments. The situation index rose by 1.4 points to 11.5 points and signals an average economic environment. Business uncertainty – measured on the basis of the estimability of the future own business situation – remained high despite declines. Due to the continuing high economic risks, economic expectations remained almost unchanged and, at 1.3 points, signal a continuation of the restrained economic momentum.

The current situation index rose by 1.4 points in January and was in positive territory at 11.5 points. However, in the manufacturing sector, which is particularly sensitive to the economic situation, the situation index lost 1.3 points compared to the previous month and remained only just above the zero line at 2.6 points. In the construction industry the situation index lost 1.8 points and remained in positive territory at 17.8 points. In the service sectors the index gained 2.3 points compared to the previous month and signalled again confident economic assessments with a value of 17.2 points. In the retail sector, the situation index rose by 4.9 points to 2.2 points and was in positive territory for the first time since September 2021.

The business expectations index of the overall economy remained almost unchanged in January (+0.3 points) and at 1.3 points was still only just above the zero line separating negative from positive economic expectations. In the retail sector, the expectations index fell (–1.2 points) and stood at –18.3 points, deep in the sceptical range. In the service sectors, the expectations index remained almost unchanged (+0.3 points) at 3.7 points. In the construction industry, the expectations index fell by 4.6 points, but remained at an optimistic 27.4 points. This high value is due to the continued high construction price expectations. Business situation expectations in the construction industry remained in negative territory. In the manufacturing sector, which was particularly affected by the energy price increases, the expectations index showed a slight recovery (+2.8 points). However, the index remained pessimistic at –5.3 points.