In August 2007 the Business Climate in Industry fell by 3.7 Percentage Points

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In August 2007 the Business Climate in Industry fell by 3.7 Percentage Points

n August 2007 the total business climate indicator decreased by 1.9 percentage points as compared to the previous month.

After three consecutive long-term maximums for the last 13 years in August the business climate in industry fell by 3.7 percentage points below its July level, because of the shifting of opinions about the business situation in enterprises from optimistic to more moderate assessments and expectations.

In August 2007 the economic conjuncture in construction remained favourable, regardless the composite indicator of business climate decreased by 2.2 percentage points as compared to the previous month.

The greatest impediment for the business development in the branch remained the competition in own sector. However during the last month more and more managers pointed out “uncertain economic environment” and “shortage of labour force” as factors limiting activity, which was accompanied also by intentions of additional hiring of personnel over the next 3 months.

As regards the selling prices in construction the last business inquires recorded considerable inflationary expectations.

In August 2007 the composite indicator of business climate in retail trade kept its level of the previous month. Managers' assessments about the present business situation in trade enterprises were positive as their expectations for the next 6 months showed also that it would keep the same level (61.2% of the enterprises) or improve (36.0%).

In August 2007 the economic conjuncture in service sector remained also favourable as the composite business climate indicator kept approximately its July level. The managers were more moderate in their prognoses about both expected business situation of enterprises over the next 6 months as well as expected demand for services.

The competition in the branch continued to be with the greatest weight among factors limiting the enterprises in the sector (pointed out by 57.9% of them). But in the last month the relative share of managers pointed out the uncertainty in economic environment and weakness in economic legalization as problems for development of activity was decreased.

As regards the selling prices most enterprises (76.5%) foresaw no change over the next 3 months.

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