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Businesses Soften Their Guarded Economic Outlook – Business Outlook Survey in August

Businesses Soften Their Guarded Economic Outlook – Business Outlook Survey in August

Although softening in August compared to July, companies’ expectations of their current performance have been guarded for two months running.

Persistently high security risks, limited logistical capabilities for exporting, falling exports, more damage to infrastructure, higher fuel prices, and the slow recovery of the labor market are restraining companies’ economic activity, while also adversely affecting respondents’ expectations.

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 2023, the BAEI was 49.3, up from 48.8 in July, coming close to its neutral level of 50 points.

Industrial companies have, for two months running, reported guarded expectations for their economic performance on the back of disrupted supply chains, reduced export capabilities and higher fuel prices, the sector’s DI being 48.8 in August, up from 48.2 in July. Respondents expected a rise in stocks of raw materials and supplies, the number of new orders, the amount of manufactured goods, and in finished goods stocks. In contrast, respondents expected a decrease in the number of new export orders, while also reporting more pessimistic views about the amount of unfinished products.

Construction companies have reported a positive economic outlook for four months running due to the restored production of construction materials, budgetary financing for the construction and restoration of housing/infrastructure, and seasonal factors, the DI being 51.0 in August, down from 51.6 in July. Respondents continued to expect an increase in construction volumes, the number of new orders and in purchases of raw materials and supplies. Respondents reported weaker expectations of a rise in purchases of contractor services and in the cost of these services. Meanwhile, companies downgraded their expectations of the availability of contractors. 

Trading companies have reported a positive economic outlook for six months running on the back of constant domestic demand, the stable operation of the energy system, and improved inflation and exchange rate expectations, the sector’s index being 52.5 in August, up from 51.6 in July. Respondents continued to expect a rise in their trade turnovers, the amount of goods purchased for sale, the prices of goods purchased for sale, while also expecting weaker growth in purchase prices. Companies noticeably improved their views about their stocks of goods for sale and continued to declare intentions to cut their trade margins.

Services companies have, for four months running, reported the most guarded performance expectations compared to other sectors because of the ongoing blockade of the grain corridor, households’ weak purchasing power and depressed demand. The sector’s DI, at 47.3, remained at the level of July. Respondents remained downbeat about the amount of services provided and the number of new orders for services, while expecting a slight increase in the amount of services that are being provided.

Although some companies softened their views, respondents continued to report expectations of a rise in purchase prices, while also declaring intentions to raise their selling prices.

Employment expectations were guarded. As in July, only trading companies declared intentions to hire more staff. Meanwhile, construction companies did not expect any changes. Conversely, industrial and services companies reported stronger intentions to cut their workforces.


This survey was carried out from 3 August through 23 August 2023. A total of 494 companies were polled. Of the companies polled, 43.5% are industrial companies, 29.4% services companies, 21.9% trading companies, and 5.3% construction companies; 32.2% of the respondents are large companies, 29.8% medium companies, and 38.1% small companies.

Out of the surveyed companies, 31.2% are both exporters and importers, 7.7% are exporters only, 17.4% are importers only, and 43.7% 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 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 performance 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 2023 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 2023.


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