WIFO-Konjunkturtest
Part of the Joint Harmonised EU Programme
of Business and Consumer Surveys
WIFO-Konjunkturtest
Part of the Joint Harmonised EU Programme
of Business and Consumer Surveys
WIFO-Konjunkturampel (economic traffic light)
The results of the WIFO-Konjunkturtest (business cycle survey) for October show a slight deterioration in companies' economic assessments compared to the previous month, although they remain tense. At –6.5 points (seasonally adjusted), the WIFO economic climate index in October was 0.6 points below the previous month's value (–5.9 points). The assessment of the overall economic situation deteriorated slightly (–1.3 points) and is below the zero line at –8.7 points. Economic expectations are moving sideways (–0.2 points) and remain skeptical at –5.3 points. The economic picture continues to be dominated by the weak industrial economy. However, the decline in the index values in October is primarily due to the slight deterioration in economic assessments in the service sector. The WIFO economic traffic light is therefore back to “red”, signaling a slowdown in economic momentum.
Economic Sentiment Dips in the EU and the Euro Area, Employment Expectations Remain Broadly Stable
In October 2024, the Economic Sentiment Indicator (ESI) dipped by 0.7 points in both the EU (to 96.0 points) and the euro area (to 95.6 points). The Employment Expectations Indicator (EEI) remained broadly stable (EU: +0.1 points to 100.0 points, euro area: –0.2 points to 99.2 points). While the EEI is at or close to its long-term average of 100, the ESI moved slightly further away from that reference value.
Credit Conditions of Austrian Companies
The credit questions of the WIFO-Konjunkturtest (business cycle survey) allow us to present the assessments and experiences of companies with regard to bank lending. The credit questions are asked quarterly in February, May, August and November.
In August 2024, companies‘ assessments of banks’ willingness to lend – defined as the balance of the proportion of companies that describe banks‘ lending as accommodating (positive values) and the proportion of companies that describe banks’ lending as restrictive (negative values) – deteriorated slightly (–0.8 points) compared to the previous quarter (i.e.: the credit hurdle increased) and remained deep in negative territory at ‑19.2 points. The assessments by company size show differences: The credit hurdle is higher for smaller companies (less than 50 employees) (‑22.5 points) than for medium-sized companies (50 to 250 employees: –12.4 points) and large companies (more than 250 employees: –15.3 points).
The survey results show an increase in demand for credit (+1.4 percentage points compared to the previous quarter), which at 21.2% in the aggregate (excluding retail) is now in line with the long-term average (21.0%). In the construction industry, 22.2% of companies reported a need for credit, in manufacturing 21.3%, in the service industries 20.9% and in retail 15.4%. In terms of company size (excluding retail), 21.7% of smaller companies (less than 50 employees) reported a need for credit, 20.3% of medium-sized companies and 22.5% of larger companies (more than 250 employees).
Of the companies with credit requirements (excluding retail), around 35.8% had to cut back on the amount or conditions (21.8% reported worse conditions, 5.6% lower amount and 7.3% worse conditions and lower amount than expected). This figure is still above the average of the past five years (29.2%). Around 32% of companies requiring credit were able to obtain it as expected (5-year average: 45.1%). At 33%, the proportion of companies with credit requirements that did not receive a loan or did not apply for one was also above average (5-year average: 24.9%; around 7.4% of all companies surveyed) because the loan application was rejected by the bank (5.8%), the conditions were unacceptable (16.2%) or they did not try to obtain a loan due to lack of opportunity (11.2%).
Credit Constraints and Credit Needs
Recent issues: WIFO-Konjunkturtest
Quarterly results of the WIFO-Konjunkturtests
Special issues: WIFO-Konjunkturtest
Recent issues: WIFO-Investitionsbefragung
Contact
For general enquiries, please contact konjunkturtest@wifo.ac.at.