October 3, 2023

Business tendency survey results and economic sentiment indicator

In September 2023, economic sentiment indicator in Lithuania was on an increase

In September 2023, against August, the economic sentiment indicator, i.e. confidence of economic actors – producers, consumers and investors – in Lithuania’s economy, increased from -7.2 to -6.2 per cent. The consumer* confidence indicator grew from -1.6 to 1 per cent, industry – from -15.8 to -14.2 per cent. The construction confidence indicator decreased from -13 to -15.2 per cent, retail trade – from 4.4 to 3.5 per cent. The services confidence indicator remained almost unchanged (increased from -0.6 to -0.4 per cent).

Compared to September 2020, economic sentiment indicator increased by 2 percentage points. The consumer confidence indicator increased by 16.9, retail trade – 6.2, services – 3.4, construction – 1.7 percentage points. The industry confidence indicator decreased by 7.1 percentage points.

Industry confidence indicator

The results of an opinion survey of industrial enterprise managers showed that in September, against August, business trends in industry improved. An increase of 1.6 percentage points was determined by more optimistic expectations for production.

More than half (58 per cent) of the respondents expected production to remain unchanged in the coming 3 months, the proportion of those expecting it to increase grew from 19 to 23 per cent, and 19 per cent of respondents expected it to decrease. However, as regards exports of products, the expectations were more pessimistic than a month ago: the proportion of those expecting an increase in exports dropped from 20 to 17 per cent, 63 per cent of the respondents expected the exports to remain unchanged, 20 per cent – to decrease. Like in the previous month, the majority (78 per cent) of the interviewed managers expected the number of employees to remain unchanged, 8 per cent – expected it to increase, 15 per cent – to decrease. 81 per cent of the respondents expected the prices of their products to remain unchanged in the short run, 8 per cent – expected them to increase, 12 per cent – to decrease.

Like in the previous month, more than half (60 per cent) of the managers stated that the production demand was sufficient, 39 per cent – insufficient, 1 per cent – excessive. In September, an increase in production in the last 3 months was indicated by 13, a decrease – 22 per cent of the respondents.

Construction confidence indicator

In September, against August, business trends in construction sector deteriorated. The construction confidence indicator decreased by 2.2 percentage points. This was influenced by more pessimistic employment expectations.

The majority (72 per cent) of the managers expected the number of employees to remain unchanged in the short run, while the proportion of those expecting it to increase dropped from 18 to 16 per cent, to decrease – grew from 10 to 13 per cent. As regards construction orders, expectations were more pessimistic than in the previous month: a decrease in construction orders in the coming months was expected by 22, an increase – 17 per cent of the respondents (in August, 18 and 23 per cent respectively). In September, 25 per cent of the respondents expected the construction work prices to increase, 67 per cent – to remain unchanged, 8 per cent – to decrease.

Like in the previous month, 63 per cent of the respondents stated that work demand was sufficient, 35 per cent – insufficient. More than half (55 per cent) of the managers stated that the volume of construction works remained unchanged, an increase was indicated by 21, a decrease – 23 per cent of the respondents.

Retail trade confidence indicator

In September, against August, business trends in retail trade slightly deteriorated. The retail trade confidence indicator decreased by 0.9 percentage points. This was influenced by slightly worse developments in all three components of the confidence indicator.

Compared to the previous month, the proportion of respondents stating that in the last 3 months their business situation improved dropped from 21 to 20 per cent, while 11 per cent of the interviewed stated that it deteriorated.

In September, the majority (81 per cent) of the interviewed managers expected their business situation to remain unchanged in the coming 3 months, 11 per cent – to improve (a month ago, 12 per cent), 8 per cent – to deteriorate. 12 per cent of the interviewed planned on purchasing more, 13 per cent – fewer goods than a month ago, while 74 per cent of the respondents intended to purchase the same amount of goods as in the previous month.

The majority (81 per cent) of the respondents did not intend to change the number of the employees, while the proportion of those planning to increase it dropped from 14 to 8 per cent. In September, 80 per cent of the respondents expected the prices of goods to remain unchanged, 19 per cent – to increase.

Services confidence indicator

In September, against August, changes in business trends in service sector were moderate.

74 per cent of the respondents stated that their business situation in the last months remained unchanged, 13 per cent – indicated improvement, 13 per cent – deterioration in the business situation. The majority (68 per cent) of the managers stated that service demand remained unchanged in the last 3 months, while the proportion of those indicating an increase in demand grew from 11 to 14 per cent, a decrease was indicated by 18 per cent of the respondents.

As regards service demand, expectations for the coming 3 months were similar as a month ago: 16 per cent of the respondents expected the service demand to increase, 72 per cent – to remain unchanged, while the proportion of those expecting it to decrease grew from 10 to 12 per cent. The majority (68 per cent) of the managers expected the number of employees to remain unchanged, 20 per cent – planned on hiring new employees. 81 per cent of the respondents expected the prices of services to remain unchanged in the short run, 16 per cent – to increase.

Source: Statistics Lithuania
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