GKI Economic Sentiment Index Hits 11 Month High In September

A survey conducted by GKI Economic Research – with the support of the European Union – found that both consumers and businesses were more optimistic in September than in August. The GKI economic sentiment index, a summary measure of expectations, rose by just over two points, reaching an eleven-month high. Firms’ hiring intentions and expectations for selling prices remained unchanged from the previous month, while the predictability of the business environment slipped slightly.

The GKI business confidence index rose by two points in September, following a similar increase in August, reaching an eleven-month high. The industrial confidence index climbed by two points and the services index by three, while retail and construction indicators remained unchanged. The industrial index is now at its highest level in fifteen months. Looking ahead, construction remains the most pessimistic sector, while business services are the most upbeat.

The overall employment indicator, which reflects firms’ staffing expectations, remained largely unchanged from the previous survey. Over the next three months, 7% of businesses plan to expand their workforce, while 13% intend to cut it. Industry and business services are the most optimistic sectors, whereas construction remains the least upbeat.

The predictability of the business environment slipped slightly in September, with industrial and construction firms most affected by the uncertainty.

The price indicator, which gauges firms’ expectations for selling prices over the next three months, remained unchanged from August. In the coming quarter, 19% of companies plan to raise prices, while 9% expect to cut them.

The GKI consumer confidence index rose by two points in September, reaching a twelve-month high. Although households felt their financial situation over the past year had worsened and their outlook for the next 12 months remained unchanged, they were considerably more optimistic about the country’s economic prospects over the same period. Perceptions of disposable income for major purchases also improved. Inflation expectations and fears of unemployment eased compared with August.