Economic Sentiment Remains Sceptical Despite Improvement

The index of current assessments of the overall economy rose by 1.7 points to –3.2 points in May, but remained below the zero line that separates positive from negative assessments. In the manufacturing sector, the index rose sharply (+4.5 points), but at –6.5 points it remained in the sceptical range. In the construction sector, the situation index also rose sharply (+5.8 points) and, at 2.7 points, stood above the zero line in positive territory. In the service sectors, the rise in the situation index remained modest (+0.3 points); at –2.2 points, it remained in negative territory. In the retail sector, there was a marked decline in the current situation index (–3.4 points), which stood at –3.4 points, back below the zero line.

The index of business expectations for the economy as a whole rose slightly in May (+0.3 points) and, at –6.6 points, remained well below the zero line that separates negative from positive economic expectations. In the retail sector, the expectations index fell slightly (–0.3 points) and stood at –15.1 points, indicating sceptical economic expectations. In the services sector, the expectations index remained virtually unchanged (–0.1 point) and stood at –7.4 points, still well below the zero line. In the construction sector, the index rose (+1.2 points) to stand at 10.4 points. Unlike in previous months, however, it was not construction price expectations that were responsible for the rise in the expectations index; employment and business situation expectations remained at sceptical levels despite improvements. In the manufacturing sector, the expectations index rose slightly in May (+0.8 points), but at –7.7 points it remained in the range of pessimistic economic expectations.