Economic Tendency Survey July 2019

Weaker sentiment than normal in the economy

The Economic Tendency Indicator fell further in July from 98.1 to 96.8, pointing to somewhat softer sentiment than normal in the economy. The decrease was due to weaker signals from manufacturing and services, whereas consumer confidence improved for a second month.

The confidence indicator for the manufacturing industry fell further to slightly more than 3 points below the historical average, following weaker signals from basic materials. In terms of the questions behind the indicator, it was firms’ view of their order books and stocks of finished goods that contributed to the decline.

The confidence indicator for the building and civil engineering industry climbed to slightly above the historical average. The increase was due to an upward revision of housebuilders’ employment plans, while the other component of the indicator – firms’ view of their current order books – deteriorated for both housebuilders and civil engineers.

The confidence indicator for the retail trade was almost unchanged at 102.7, which points to a slightly stronger situation than normal. That said, the indicator is above 100 solely as a result of firms’ relatively strong take on their stocks.

The confidence indicator for the service sector dropped to 96.5, which reflects weaker sentiment than normal. The decrease was due to firms reporting a slightly weaker performance over the past three months.

The consumer confidence indicator remains below the historical average despite an increase of 3.6 points in July. All questions contributed to the improvement, with increases in both the micro index and the macro index. The micro index is now back above the historical average, suggesting that consumers are relatively positive about their personal finances.