Recovery of Economic Expectations is Taking Shape

31.07.2020

WIFO-Konjunkturtest July 2020

Despite a significant increase (+5.9 points), the WIFO business climate index in July remains at –15.0 points, a level last reached in the financial market and economic crisis of 2008-09. Austrian enterprises are still pessimistic in their assessments of the current economic situation, although the improvement in economic expectations is taking shape. Enterprises in the construction industry are more confident in their economic assessments than enterprises in manufacturing and service industries.

The index of current assessments of the overall economic situation increased by 7.9 points in July (excluding seasonal fluctuations) to the –22.6 mark, which is in line with the figures measured in April. Increases can be seen across all sectors. In the services sectors, the index rises by 9.9 points to the –25.7 mark but remains close to the historical lows. In the construction industry the situation index rises by 8.4 points and is already in positive territory with 3.9 points. In the manufacturing sector the situation index gained 4.6 points, but at –25.9 points is still in the sceptical range.

The expectations of Austrian companies across all sectors are significantly less negative than in the previous month. The index of business expectations increased by 3.9 points in July but remained negative at –7.5 points. In the construction industry alone, the expectations index is above the zero line that separates negative from positive expectations: after a slight decrease of 1.5 points, the index now stands at 2.5 points. In the service industries the expectations index rises (+3.0 points), but at –6.4 points remain in the sceptical range. The expectations index for the manufacturing sector also continues to recover (+7.0 points), but at –12.4 points is still rather cautious. The majority of the companies in the tangibles manufacturing sector in particular expects a rather moderate normalisation dynamic in the coming months.

Details on all sectors in the current economic survey can be found here.
 

Publications

Erholung der Konjunktureinschätzungen nimmt Gestalt an. Ergebnisse des WIFO-Konjunkturtests vom Juli 2020 (Recovery of Economic Expectations is Taking Shape. Results of the WIFO Business Cycle Survey July 2020)
WIFO Business Cycle Survey, 2020, (7), 11 pages
Supported by: European Commission, DG Economic and Financial Affairs
Study by: Austrian Institute of Economic Research
Online since: 30.07.2020 14:00
Der WIFO-Konjunkturklimaindex liegt im Juli trotz eines deutlichen Anstieges (+5,9 Punkte) mit –15,0 Punkten weiter auf einem Niveau, das zuletzt in der Finanzmarkt- und Wirtschaftskrise 2008/09 erreicht wurde. Die österreichischen Unternehmen schätzen die aktuelle Konjunktur weiterhin pessimistisch ein, allerdings nimmt die Verbesserung der Erwartungen deutlicher Gestalt an. In der Bauwirtschaft sind die Unternehmen wesentlich zuversichtlicher als in der Sachgütererzeugung und den Dienstleistungen.
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Werner Hölzl

Research groups: Industrial Economics, Innovation and International Competition
© Ahmed Elqsas/behance.net
© Ahmed Elqsas/behance.net