K&H SME confidence index: Businesses are still in a negative mood

By: Trademagazin Date: 2024. 04. 15. 13:14

The hopeful improvement of the K&H SME confidence index seen at the end of last year came to a halt again in the first quarter of this year: with a drop of 4 points, the indicator stands at -10 points, which has been in the negative range for almost two years. The main reason for the decline is the negative perception of the labor situation and economic prospects.

The K&H SME confidence index, which indicates the expectations of Hungarian micro, small and medium-sized enterprises for the year ahead, has fallen again, which currently stands at -10 points.

“At the end of last year, it seemed that the businesses were more optimistic again and the improvement started, as the index rose by 5 points in the fourth quarter. However, the growth has now stopped, so it is permanently in the negative range for the seventh quarter. Moreover, it shows the third lowest value since 2014. The main reason for pessimism is that businesses see the situation of the workforce and the economy as gloomy. The latter is no wonder, since despite the faster-than-expected rate of inflation, the increase in consumption cannot start, the fate of EU funds is also uncertain, and the demand-reducing effect of the economy, which is permanently in recession, is also evident.