In September, businesses continued to ease their negative performance expectations as they adapted to wartime conditions and the population adjusted to the new situation. At the same time, economic recovery across all sectors is being dampened by destroyed production facilities, logistical hurdles, rising energy prices, a drop in investment, imports and exports, and a decrease in purchasing power.
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 September 2022, the BAEI was 46.1, up from 44.1 in August.
Industrial companies slightly upgraded their economic outlook for September, as the sector’s index moved to 47.1, up from 46.7 in August. Respondents have expected an increase in the amount of manufactured goods for two months in a row on the expectation of a rise in the number of new orders. At the same time, expectations for new export orders remained pessimistic.
Construction companies reported the most guarded performance expectations across all sectors on the back of the low purchasing power of consumers, the state of adjacent markets and seasonal factors: the sector’s index was 41.0, down from 41.2 in August. Respondents were less downbeat about their construction volumes and the number of new orders. At the same time, respondents expected no increase in purchases of raw materials and supplies.
The expectations of trading companies improved and came very close to the neutral level for the first time in 2022: the sector’s index was 49.9, up from 47.4 in August. Respondents were upbeat about their trade turnover and the amount of goods purchased for sale, while reporting a decrease in the stocks of goods for sale. Companies in the sector said they intended to decrease their trade margins further.
Services companies also improved their expectations of their business performance, with the sector’s index moving to 43.4 in September, up from 39.6 in August. Respondents eased their negative expectations for the amount of services provided, the number of new orders, and the amount of services that are being provided. At the same time, they continued to report strong intentions to raise their selling prices.
On the back of stronger expectations of a rise in raw material and supply prices, most of the surveyed sectors continued to report firm intentions to raise their selling prices.
Staff expectations remained restrained. Respondents across all sectors continue to report no intentions to expand their workforces. Trading companies reported the least pessimistic expectations.
This survey was carried out from 5 September through 23 September 2022. A total of 448 companies were polled. Of the companies polled, 45.8% are industrial companies, 27.2% services companies, 21.9% trading companies, and 5.1% construction companies; 30.1% of the respondents are large companies, 31.5% medium companies, and 38.4% small companies.
Of the companies surveyed, 31.3% are both exporters and importers, 11.4% are exporters only, 15.0% are importers only, and 42.4% 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 September 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 October) will be published on the first business day of November 2022.