The business activity expectations index (BAEI) was 41.0 in January 2025, unchanged on January 2024. In January, businesses usually weaken their expectations of their current economic performance compared to other months, due to seasonal factors.
The BAEI dynamics was restrained by the difficult security situation, a lack of investment in production capital, energy and labor needs, rising production costs, inflation and depreciation. At the same time, sustained consumer demand and substantial international financial aid were positive factors.
Industrial companies reported more guarded performance expectations amid the destruction of production facilities, a lack of investment in production capital, a shortage of labor, and higher production costs, the sector’s index being 42.0 in January, compared to 43.7 in January 2024. Respondents continued to weaken their expectations about the amount of manufactured goods, the number of new orders for products, including export orders, and about unfinished products. Respondents expected a further decrease in finished goods stocks and in stocks of raw materials and supplies. At the same time, industrial companies were less downbeat about their amounts of unfinished products.
Trading companies, as a rule, declare much gloomier expectations of their economic performance at the beginning of the year than in other months, the sector’s index being 40.0 in January. At the same time, this indicator was higher than the figure for January 2024 (38.9). Respondents expected a decrease in trade turnover and in the amount of goods purchased for sale. Meanwhile, companies improved their expectations for the stocks of goods purchased for sale. Respondents continued to report intentions to cut their trade margins.
Seasonal factors, coupled with higher production costs, weakened services companies’ expectations of their economic performance, the sector’s index being 41.1 in January. At the same time, this indicator was higher than the figure for January 2024 (40.4). Respondents expected a further drop in the amount of services provided, the number of new orders for services, and in the amount of services that are being provided.
Due to the seasonal nature of construction work and shortages of qualified staff, construction companies have reported the most guarded economic outlook of all the sectors for three months in a row, the sector’s index being 37.2 in January. However, the index improved significantly on January 2024 (31.9). Respondents expected a further drop in construction volumes, the number of new orders, and in purchases of raw materials and supplies. Despite slower growth in the cost of contractor services, respondents said they intended to purchase fewer of these services.
In industrial, construction and services sectors, there was only a slight change in the percentage of respondents who declared intentions to raise their selling prices. In contrast, in the trading sector, the percentage of respondents who reported intentions to raise their selling prices dropped noticeably, due to, among other things, seasonal sales.
The labor market situation remained challenging. Respondents across all of the surveyed sectors declared intentions to reduce their workforces, with the strongest intentions reported by construction companies. That said, services companies improved their still pessimistic employment outlook.
This survey was carried out from 6 January through 23 January 2025. A total of 519 companies were polled. Of the companies polled, 43.7% are industrial companies, 26.6% services companies, 24.5% trading companies, and 5.2% construction companies; 29.7% of the respondents are large companies, 28.3% medium companies, and 42.0% small companies.
Out of the surveyed companies, 33.1% are both exporters and importers, 9.2% are exporters only, 18.7% are importers only, and 38.9% are neither exporters nor importers.
The findings presented reflect only the opinions of the respondents (top managers of 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. The NBU calculates the BAEI on a monthly basis, apart from the forced break in March–May 2022.
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 January 2025 survey in the Monthly Surveys of Companies Subsection of the Publications Section on the NBU’s official website. Survey results are available in the open data format.
The results of the next survey (for February 2025) will be published on the first business day of March 2025.