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Businesses Report Guarded Economic Outlook – Business Outlook Survey in July

Businesses Report Guarded Economic Outlook – Business Outlook Survey in July

Following three consecutive months of positive expectations, in July businesses reported a guarded economic outlook.

Higher electricity prices for businesses, the reimposition of pre-war taxes on fuel prices, the halt in the operations of the grain corridor, more intense missile attacks on infrastructure, together with considerable shortages of qualified staff, had an adverse effect on companies’ 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 July 2023, the BAEI dropped below its neutral level of 50 points, to 48.8, down from 50.8 in June.

After reporting optimistic expectations for four months, industrial companies expected a deterioration in their economic performance – the sector’s DI was 48.2 in July, down from 51.0 in June. Respondents expected a decrease in the number of new export orders, the amount of unfinished products (unfulfilled orders), and in stocks of raw materials and supplies.

At the same time, respondents expected a slight increase in the amount of manufactured goods, while also expecting the number of new orders to remain at previous month’s level.

Construction companies have reported a positive economic outlook for three months in a row thanks to the rebounding construction of roads, bridges, tunnels and pipelines, and seasonal factors. The DI was 51.3 in July, down from 58.6 in June. Respondents continued to expect an increase, albeit at a significantly slower pace, in construction volumes, the number of new orders and in purchases of raw materials and supplies. Respondents continued to report high assessments of the prices of contractor services, while the availability of contractors remained at the level of the previous month.

Trading companies have reported positive performance expectations for five months in a row thanks to the saturation of the market with goods and decelerating inflation, the sector’s index being 51.6 in July, down from 52.5 in June.

Respondents continued to report expectations of a rise in the amount of goods purchased for sale and of a faster increase in the prices of goods purchased for sale on the back of high supplier prices. They also continued to report intentions to cut their trade margins.

Services companies continued to report the most guarded economic outlook among other sectors of the economy due to the blocked grain corridor, higher fuel prices and falling demand because of households’ weak purchasing power. The sector’s DI was 47.3, down from 48.9 in June. For the first time since April 2023, respondents were downbeat about the amount of services provided. They also expected a decrease in the number of new orders for services. Meanwhile, the amount of services that are being provided was expected to rise slightly.

Most respondents said they intended to raise their selling prices on the back of higher purchase prices.

Employment expectations were guarded. Only trading companies declared intentions to hire more staff. Construction companies said they expected no changes. Conversely, industrial and services companies said they intended to cut their workforces.


This survey was carried out from 5 July through 24 July 2023. A total of 490 companies were polled. Of the companies polled, 44.9% are industrial companies, 28.2% services companies, 22.2% trading companies, and 4.7% construction companies; 33.7% of the respondents are large companies, 29.0% medium companies, and 37.3% small companies.

Out of the surveyed companies, 31.8% are both exporters and importers, 9.0% are exporters only, 16.7% 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 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 July 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 August survey will be published on the first business day of September 2023


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