THE ECONOMY
A FLICKER OF CONFIDENCE
Economic optimism shores up but corporates remain cautious amid cost pressures
Confidence in the economy strengthened in August with a larger share of corporate executives anticipating an improvement in the months ahead.
However, the outlook remains cautious with half of those surveyed expecting economic conditions to remain unchanged amid rising costs and continued uncertainty surrounding the broader economic milieu.
THE ECONOMY The latest LMD-PEPPERCUBE Business Confidence Index (BCI) survey, conducted in the first week of August, reveals a gradual shift towards greater economic optimism.
Over four in 10 (41%) of polled respondents expect the economy to ‘improve’ over the next 12 months, which is a four percentage point increase from July. And half (50%) believe conditions will ‘stay the same’ – a decline of three percent from the previous month.
And a mere nine percent expect the economy to ‘get worse,’ representing a one point decline from July.
SALES VOLUMES Sales expectations softened in August with half (50%) of the survey participants anticipating an improvement over the next 12 months compared to 52 percent in the preceding month.
However, 38 percent expect their sales volumes to ‘stay the same,’ down three percentage points from July, while 12 percent anticipate their sales numbers will ‘get worse’ – up five points from the month prior.
Over the past 12 months, 39 percent report an ‘increase’ in sales volumes, marking a one percentage point decline compared to July.
At the same time, 38 percent say their sales volumes ‘stayed the same’ – down by a notable seven points from July – while less than a quarter (23%) report an increase, up eight points from 15 percent in the preceding month.
Looking ahead to the next three months, the outlook appears to be largely unchanged with 41 percent of survey participants expecting an increase in sales volumes compared to July’s 40 percent.
Moreover, nearly half (47%) of the sample population expect their sales volumes to ‘stay the same’ (down 2%) while a mere 12 percent anticipate their numbers to ‘get worse’ over the next three months – that’s one percentage point higher than in the previous month.
INVESTMENT CLIMATE Confidence in the investment climate remained muted in August with none of the respondents rating the outlook as ‘very good’ – compared to two percent in July.
In the meantime, 10 percent describe the outlook as ‘good’ while 67 percent say the investment climate is ‘fair’ – up 14 percentage points from the month prior (53%).
In contrast, 22 percent of respondents view the investment climate as ‘poor’ or ‘very poor,’ marking an eight point decline from the preceding month (30%).
EMPLOYMENT PROSPECTS One in five (20%) poll participants say they intend to ‘increase’ their staff numbers, representing a five percentage point spike compared to July.
And some two-thirds (67%) of those surveyed say they intend to maintain their current workforce levels – down six percentage points – while 13 percent expect to downsize over the next six months, which is one point higher than in the preceding month.
– LMD
