The improvement of external conditions, logistics, the situation in the energy sector, the increase in consumer sentiment positively affected business expectations in March.
This is evidenced by the business activity expectations index (BAEI), which the National Bank of Ukraine (NBU) calculates every month, excluding the forced break in March-May 2022, Ukrainian News Agency reports.
Enterprises of all sectors involved in the survey were more optimistic about the results and prospects of their activities.
In March 2023, BAEI increased to 49.5 (from 45.0 in February) and almost reached equilibrium level.
This is the highest reading since December 2021.
Trade enterprises provided the most optimistic estimates of the results and prospects of their activities amid a revival of consumer sentiment, improving the situation with energy supply and an increase in the supply of goods: the sectoral index in March rose to 53.6 (from 47.0 in February), crossing the neutral level for the first time after November 2021.
Respondents significantly improved their expectations for turnover and volumes of procurement of goods for sale.
At the same time, due to the easing of estimates regarding procurement prices, they expected a slight decrease in trade margin.
The improvement of the situation in the energy sector and the external environment, as well as the establishment of supply chains, positively influenced the estimates of industry respondents.
For the first time since February 2022, they expected their economic results to rise from the previous month, with the sector index crossing neutral in March at 51.2, up from 47.2 in February.
Respondents expected an increase in the volume of manufactured products and the volume of new orders for products, including export ones.
At the same time, pessimism in estimates of unfinished production (unfulfilled orders) decreased significantly and expectations for the growth of finished product residues were weakened.
Due to the seasonal factor, construction enterprises significantly mitigated negative estimates of their economic results: the sectoral index in March was 45.9 (in February - 33.5).
Respondents expected an increase in the volume of procurement of contractor services, as well as raw materials.
At the same time, builders did not predict changes in construction volumes and significantly weakened negative estimates of new orders.
Services enterprises, despite the seasonal revival, had the most consistent estimates regarding their economic prospects: the sectoral index was 45.7 compared to 43.2 in February.
Respondents softened somewhat, but maintained negative expectations about the volume of services provided, new orders, as well as the volume of services in the process of execution.
Most of the enterprises participating in the surveys predict a slowdown in the growth rate of procurement prices and contractor prices, as well as prices and tariffs for their own products/services.
Employment estimates remain subdued.
Businesses in all sectors involved in the survey do not yet expect an increase in the total number of their workers.
The least pessimistic estimates are of trade enterprises.
The monthly survey of businesses was conducted from March 6 to March 24, 2023.
484 businesses participated in the survey.
Among the surveyed enterprises, 46.5% are companies of industry, 28.9% are services, 20.7% are trade, 5.0% are construction.
32.9% of respondents are large enterprises, 30.0% are medium, 37.2% are small.
32.6% of the surveyed enterprises carry out export and import operations, 9.1% - only export operations, 16.3% - only import operations, 41.9% - do not carry out external economic transactions.
The survey results reflect only the opinion of respondents - managers of enterprises, and not estimates of the National Bank of Ukraine.
The monthly business activity expectations index (BAEI) is a tool for operational assessment and tracking of economic development trends.
The index is calculated on the basis of surveys of Ukrainian enterprises of the real sector of the economy.
Based on the responses of respondents, monthly indices of business expectations are calculated - sectoral (for each sector of the economy) and composite, which characterizes the economic development of the country for the month.
The index value at 50 is neutral.
Expectations are positive if the index value exceeds the neutral level.
As Ukrainian News Agency earlier reported, in February the business significantly mitigated negative estimates regarding its own economic activity.
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