In a survey conducted with European Union support, the combined business and consumer confidence index of economic research company GKI rose to -17.2 points in April from -18.6 points in March, only a touch below the level last reached in August 2008 (-17.3). In September 2008, the last month before the onset of the global economic crisis, the index stood at -17.9.

The seasonally-adjusted index stood at -25 points in October 2008 and bottomed out at a historical low of -46.2 points in April last year.

The business confidence index rose to -10.2 points in April arch from -10.7 points in March. The consumer confidence index ticked higher to -37 points from -41.2 pts in the third month of the year. The index has not been this high since May 2006.

While the favourable sentiment shift in the business sphere in March was attributable exclusively to improved expectations of industrial companies, it was the latter group who turned more pessimistic about their future, while expectations in the other sectors improved markedly.

The unfazed rise in the confidence index of the industry has broken for the second time in a year. The respondents in this group view their production outlook through the same eyes as a month ago, but they have turned less confident about their stock of orders and self-produced inventories. They also said their export orders decreased. The deterioration in sentiment, however, was not as strong as the improvement in March.

After a moderate decline in March, the construction sector sub-index ticked higher again, but it remains well below the pre-crisis level. The respondents’ views about production volumes of the past three months and about their stock of orders have improved from the previous month.

The confidence index of trade companies have been rising steadily over the first three months and jumped in April to a pre-crisis level. The seasonally-adjusted confidence index of services companies rose considerably in April, following fluctuations in Q1. it is now close to pre-crisis levels.

Industrial players expect sales prices to increase over the next three months, while those construction companies projecting price reductions outnumbered those who see price hikes ahead.

Now more service and trade companies plan price increases, while the inflation expectations of consumers has moderated since March.

Industrial and trade companies were less confident that they would be able to expand their staff, while construction and especially services companies said their hiring intentions increased. Consumers’ fears from unemployment also declined considerably.

In April, the number of companies saying the outlook on the economy has worsened was only slightly bigger than the number of those who see better economic conditions ahead."

Source: Portfolio Online Financial Journal