In terms of individual business indicators, the Construction sector has seen a significant improvement in expectations, while the Industry sector has seen a milder improvement. However, the remaining sectors have experienced a marginal decline.
Meanwhile, the consumer confidence index has decreased to the level of November after correcting the increase observed during the holiday season.
Although there are uncertainties in international trade, the domestic industry seems to expect a relative improvement in its dynamics, while Construction is also moving strongly upwards, with accelerated investments and a significant amount of backlog of projects.
In households, despite the slight decrease in inflation, the pressure from the general rise in the price level remains. Inflation is expected to remain a problem this year as well, despite the rise in interest rates that has taken place. However, the prolonged relative summer for most of the month continues to dampen the impact of household energy costs.
Overall, expectations are positive for the economy, with an increase in investments that will have a positive effect on the market and a decrease in unemployment in 2024.
In further detail,
- In the Industry sector, the negative balance of estimates for orders and demand has increased, but the estimates for stocks have decreased. However, the positive forecasts for production in the upcoming months have improved significantly.
- In the Construction sector, the negative forecasts for business work programs have reduced significantly, while the positive estimates for employment have remained unchanged.
- In the Retail Trade sector, current sales estimates are decreasing, while the level of inventories remains the same. The forecasts for short-term sales development are also weakening significantly.
- In the Services sector, the positive estimates for the current state of business and demand have decreased noticeably. However, the forecasts for the short-term evolution of demand have slightly improved.
- In Consumer Confidence, households' negative forecasts for the country's economic situation and their own economic situation have increased. Meanwhile, the forecasts for major markets have marginally weakened, and the intention to save has declined.
The negative forecasts for the business work program turned positive, while the positive forecasts for employment remained unchanged. Specifically, the negative index on forecasts for the business work program improved from -8 points in the previous month to +9. 31% of the businesses expressed optimism about the level of work in the next quarter, up from 25%. In employment forecasts, the relative index remained at +35 points. 38% of respondents predicted an increase in jobs in the sector, while 3% estimated a decrease.
The estimates for the current course of work slightly strengthened and formed a +38 index, up from +32 points. In the field of prices, inflationary expectations have significantly improved from +36 points to +44.
Furthermore, 12% of businesses reported seamless operations, up from 8%. The main obstacles to their operation were the lack of workforce (42%), insufficient funding (14%), and the lack of mechanical equipment (10%). The degree of uncertainty prevailing in the economic environment appears to be strengthening, as 68.1% of businesses consider future growth to be difficult or relatively difficult to predict, compared to 58.5% in December.
Private construction
The index for business expectations in the Private Construction sector has significantly improved and now stands at 180.8 units, up from 169.3 units previously. This is a significantly higher level than the corresponding one from last year which was at 70.5 units. Forecasts for planned work are mildly optimistic, and have strengthened slightly by 26 points from 20 points. Expectations for employment remain high at 49 points, up from 37 points. The positive estimates for the current state of business operations have moved strongly upward and are now at +52 points, up from +38 points previously. In terms of prices, inflationary trends have also strengthened strongly and are now at +62 points, up from +51 in December. Only 5% of businesses report no obstacles in their operation, while 54% of businesses report a lack of labor force, 8% report low demand, and 11% report a lack of funding. Only 3% cited other current factors as the main obstacles to their operation.
Public works
The Public Works Construction industry has seen a significant improvement in its business expectations index compared to December, with a current standing of 158.8 units, up from 142.0 units in December. This is significantly higher than last year's level of 139.2 units. The negative index of -37 points in December regarding the work program of the sector has softened significantly and is now at -6 points. In terms of employment forecasts, the relative positive balance has decreased to +22 points from +31 points. Most companies in the sector (71%) expect the same number of jobs, while only 4% predict a decrease. The estimate index for the level of current operations remains at +25 points, and there has been a small improvement in the balance of prices, which is now at +27 points. Finally, 18% of businesses report smooth business operations, with 32% citing a lack of workforce, another 17% a lack of funding, and 14% citing other current factors as their main operational barrier.
