THE ECONOMY
ECONOMIC SENTIMENT WAVERS
Sentiment about the economy among corporates has reversed direction once again
The optimism seen in business circles in May appears to have faded quicker than expected, as sentiment shifted once again in June.
THE ECONOMY The latest LMD-PEPPERCUBE Business Confidence Index (BCI) survey, conducted in the first week of June, sees a notable decline in optimism about the economy ‘improving’ over the next 12 months dropping to 56 percent – that’s a whopping 20 percentage point fall from May’s 76 percent outcome.
However, nearly four in 10 (37%) of respondents expect the economy to ‘stay the same,’ marking a 20 percentage point increase, while seven percent believe it will ‘get worse’ – this result is the same as in the month prior.
SALES VOLUMES Salespeople’s sentiment shifted upwards in June, following three consecutive months of decline with 83 percent of polled executives saying they expect an improvement in sales volumes over the next 12 months.
This marks a nine point spike from May and signals the end of the downward trend that began in March. And 16 percent of survey participants believe their sales numbers will ‘stay the same,’ which reflects a notable eight point drop from 24 percent in the preceding month.
Meanwhile, 69 percent of respondents report an ‘increase’ in sales volumes compared to the previous month, which represents a modest three percent rise from May’s 66 percent.
Additionally, 15 percent say their volumes ‘stayed the same,’ down seven points from the previous month (22%).
And 16 percent report a decline in sales volumes – that’s a four point rise from slightly over one in 10 (12%) a month ago.
Looking ahead, expectations of higher sales volumes over the next three months have risen by two percentage points to 67 percent (up from 65% in May).
Thirty percent of the sample population believe their sales volumes will ‘stay the same,’ marking a moderate one point decline.
And only three percent anticipate their numbers to ‘get worse’ over the next three months.
INVESTMENT CLIMATE Confidence about the investment climate recorded a slight uptick in June with the percentage of respondents who view the outlook as favourable rising from three to five percent.
However, those viewing the future as ‘good’ dropped by 11 percentage points to nearly a quarter (23%) – and 55 percent continue to believe the investment outlook is ‘fair,’ which is an increase of four percentage points from May’s 51 percent.
Meanwhile, the proportion of respondents rating the investment climate as ‘poor’ or ‘very poor’ has spiked to 17 percent compared to 12 percent in the preceding month.
EMPLOYMENT PROSPECTS Thirty-four percent of businesses say they plan to ‘increase’ their staff numbers – that’s an 11 point fall from the month prior.
In the meantime, 58 percent intend to maintain the status quo, which reflects a 12 point increase from the preceding month.
And only eight percent say they may consider downsizing in the next six months.
