The economic index of the GKI slowed down in July, but continued to decrease
In July, the GKI economic index fell to its lowest level in more than a year, not seen since last March. According to a survey conducted by GKI Gazdaságkutátó – with the support of the EU – since April of this year, business expectations have fallen by about 8 points, while consumer expectations have fallen by more than 20 points, but in July the pessimism of companies and the population strengthened to a similar extent. (The population survey was carried out even before the “utility increase” was announced.) Overall, the companies’ desire to raise prices did not change, and the assessment of the situation of the Hungarian economy continued to deteriorate.
The decrease in the business confidence index in July is solely the result of a noticeable deterioration in industrial expectations. The expectations of the other sectors improved compared to June, although none of them reached the level of May. In July, the industrial confidence index fell to the level of last April. The assessment of past and expected production, the order backlog – including exports – and stocks deteriorated equally. The mood of construction industry producers – after a two-month deterioration – corrected positively in July. The prospects for high-rise builders continued to deteriorate, but those of civil engineers improved noticeably, although this sub-sector is still the most pessimistic. Satisfaction with the order backlog has noticeably improved, but less so with regard to the previous three months’ production. Although the trade confidence index rose slightly compared to June, it is still not much higher than it was during the Covid epidemic. Trading companies mainly judged their order stock more favorable than in June, but they also saw their sales position as better, while their inventories were slightly less favorable. Among service companies, the perception of the general course of business and the expected turnover both improved, but that of the previous quarter’s turnover worsened.
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