Weaker signals from the business sector

The Economic Tendency Indicator fell 1 point in October to 93.6 following slightly weaker signals from the business sector. Consumer confidence improved further and is now stronger than normal for the first time since December 2021.

The confidence indicator for the manufacturing industry fell 1.9 points to 91.8. Slightly more firms than normal reported a deterioration in the competitive situation in the domestic market, and many more firms than normal reported a deterioration in the competitive situation in the EU and beyond.

The confidence indicator for the building and civil engineering industry fell 1.1 points to 94.2. However, many more builders than normal expect the construction market to improve over the next 12 months. Homebuilders are particularly optimistic: their market expectations for the next 12 months have improved substantially over the past year and have not been as positive since 2014.

The confidence indicator for the retail trade was unchanged at 105.6. Retail is the only part of the business sector where sentiment is stronger than normal. While food retailers and motor dealers are more upbeat than normal, the indicator for specialist retailers is below the historical average.

The confidence indicator for the service sector fell 1.1 points to 93.9 and still shows weaker sentiment than normal. Almost six out of ten firms cited insufficient demand as a constraint on their business.

The consumer confidence indicator climbed to 101.3 and points to slightly stronger sentiment than normal. However, consumers’ plans for making home purchases, home improvements and car purchases changed only marginally and are still more cautious than normal.