Regular version of site
Skip to content
Businesses Slightly Improve Their Negative Expectations – Business Outlook Survey in August

Businesses Slightly Improve Their Negative Expectations – Business Outlook Survey in August

Businesses continue to adapt to wartime conditions, somewhat improving their negative expectations of their economic performance in August. That said, uncertainty about the duration of the war, the resulting deterioration of inflation expectations, the continued destruction of production facilities and infrastructure, coupled with the significant forced displacement of people within the country, are restraining economic revival across all sectors of the economy.

This is evidenced by the business activity expectations index (BAEI), which the NBU calculates on a monthly basis, apart from the forced break in March–May 2022. In August 2022, the BAEI was 44.1, up from 43.6 in July.

Industrial companies reported a more optimistic economic outlook due to the relocation of some businesses to safer regions, the gradual reestablishment of supply chains and the adaptation to the new conditions: the sector’s index was 46.7 in August, up from 43.1 in July. Respondents expected an increase in the amount of manufactured goods for the first time in recent months. Industrial companies also expressed less downbeat expectations about the number of new orders for products, including export orders.

Construction companies also improved their economic outlook for August amid favorable weather conditions and the gradual resumption of the construction of residential buildings and non-residential facilities: the sector’s index was 41.2 in August, up from 35.0 in July. Respondents were less downbeat about their construction volumes, the number of new orders and purchases of raw materials and supplies.

Although downgrading slightly their expectations of their economic outlook for August, trading companies were the closest to the neutral level: the sector’s index was 47.4, down from 48.7 in July. With old stocks being depleted and supplies of new goods being limited, trading companies expected a decrease in their trade turnover. They also remained guarded about purchases of goods for sale and reported a drop in stocks of goods for sale. Companies in the sector said they intended to decrease their trade margins further.

On the back of the continued destruction of transportation infrastructure, depressed demand and the loss of orders, services companies reported the most guarded expectations for their economic performance compared to other sectors, as the sector’s index dropped to 39.6, down from 41.9 in July. Respondents reported firmer expectations of a decrease in the amount of services provided, the number of new orders, and the amount of services that are being provided. At the same time, they reported weaker intentions to raise their selling prices.

On the back of stronger expectations of a rise in raw material and suppler prices, all of the surveyed sectors continued to report firm intentions to raise their selling prices.

Staff expectations remained restrained. Companies across all sectors said they did not intend to expand their workforces. That said, industrial and construction companies reported some increase in demand for labor.

For reference

This survey was carried out from 4 August through 23 August 2022. A total of 429 companies were polled. Of the companies polled, 45.7% are industrial companies, 28.2% services companies, 21.4% trading companies, and 4.7% construction companies; 31.0% of the respondents are large companies, 31.7% medium companies, and 37.3% small companies.

Of the companies surveyed, 32.9% are both exporters and importers, 9.1% are exporters only, 14.0% are importers only, and 44.1% are neither exporters nor importers.

The findings presented reflect only the opinions of the respondents (top managers of Ukrainian companies), and should not be considered as NBU forecasts or assessments.

The monthly business activity expectations index (BAEI) is a tool for conducting latest assessments and detecting trends in economic development. It is calculated on the basis of surveys of Ukrainian real sector companies.

Monthly business activity expectations indices are calculated on the basis of respondents’ replies. These indices are as follows: sectoral indices (for each sector of the economy) and a composite index (describes the country’s economic development over a month). A value of 50 corresponds to the neutral level. Index values above the neutral level indicate positive expectations.

Read more about the August 2022 survey in the Monthly Surveys of Companies Subsection of the Publications Section on the NBU’s official website.

The NBU started posting monthly survey results in the open data format.

The results of the next survey (for September) will be published on the first business day of October 2022.

Subscribe for notifications

Subscribe to news alerts