Analytics, Economics, Lithuania, Statistics

International Internet Magazine. Baltic States news & analytics Wednesday, 24.04.2019, 23:21

Economic sentiment indicator in Lithuania decreased in January 2017

Antanina Valiulienė Head, Enterprise Statistics Division, 01.02.2017.Print version
Statistics Lithuania informs that in January 2017, the economic sentiment indicator stood at minus 2 and, against December 2016, increased by 1 percentage point (ppt). The industrial and construction confidence indicators increased by 2 and 3 ppt respectively. The consumer, trade and services confidence indicators decreased by 1 ppt.

Against January 2016, the economic sentiment indicator grew by 3 ppt: the industrial and services confidence indicators increased by 6 and 2 ppt respectively. The trade confidence indicator decreased by 6 ppt. The consumer confidence indicator remained unchanged.


Economic sentiment indicator and its components

 

2015

2016

2017

XII

XII

I

II

III

IV

V

VI

VII

VIII

IX

X

XI

I

Economic sentiment indicator

–9

–5

–5

–1

–1

–2

–2

–4

–1

–1

–3

–1

–3

–2

Industrial confidence indicator

–16

–11

–7

–4

–7

–7

–9

–9

–4

–4

–8

–7

–7

–5

Construction confidence indicator

–43

–36

–31

–21

–21

–18

–17

–27

–21

–24

–31

–33

–37

–34

Retail trade confidence indicator

10

7

8

11

14

15

15

9

6

11

5

5

2

1

Services confidence indicator

1

6

2

10

14

12

11

9

12

12

10

13

9

8

Consumer confidence indicator

–7

–6

–9

–7

–8

–12

–7

–9

–10

–10

–8

–4

–5

–6



The results of the opinion survey of industrial enterprise managers showed that in January 2017, against December 2016, changes in business tendencies in industry improved. This was influenced by more optimistic expectations for production. An increase in production in the coming 3 months was expected by 24, a decrease – 12% of the respondents (a month ago, 22 and 17% respectively). Expectations for exports also improved: an increase in exports was expected by 20, a decrease – 11% of enterprise managers (a month ago, 17 and 15% respectively). Most (86 %) enterprise managers did not plan on changing the number of employees, while 10% – planned on increasing it.


However, in January 2017, deterioration was observed for both production and production demand: 23% of respondents indicated a decrease in production in the last 3 months, 20% – an increase (a month ago, 18 and 28% respectively). A decrease in production demand was indicated by 17, an increase – 28% of enterprise managers (a month ago, 15 and 31% respectively).


Fig. 1. Industrial confidence indicator and its components


 

 

On January 2017, compared to the same period of the previous year, business tendencies in construction sector improved.19% of enterprise managers stated that the volume of construction works in the last 3 months increased, 25% – that it decreased (a year ago, 11 and 44% respectively). 53% of enterprise managers stated that the order books (demand) was sufficient, 47% – gave bad assessment to their order books (a year ago, 52 and 48% respectively).


As in January 2016, the number of employees will decrease in the coming 3 months due to seasonality: a decrease in the number of employees was expected by 26%, an increase – 5% of enterprise managers (a year ago, 29 and 6% respectively). An increase in construction orders in the coming months was expected by 10, a decrease – 23% of enterprise managers (a year ago, 7 and 20%). Most (76%) respondents expected prices for construction work to remain unchanged, while 15% – expected them to increase.


Fig. 2. Construction confidence indicator and its components



 

The survey of retail trade* enterprise managers showed that in January 2017, against December 2016, business tendencies slightly deteriorated. This was influenced by less optimistic business expectations for the coming months: deterioration was expected by 14, improvement – 13% (a month ago, 16 and 17% respectively). Moreover, in January, fewer enterprises planned on purchasing more goods for resale: 10% of the interviewed planned on purchasing more goods for resale, 43% – less goods for resale (in December, 14 and 38% respectively).


However, over the previous months, improvement in trade business situation was observed: improvement was indicated by 20, deterioration – 11% of enterprise managers (a month ago, 18 and 12% respectively).


Most (72%) enterprise managers did not plan on changing the number of employees, 18% – planned on increasing it. 9% of enterprise managers planned on increasing the prices of goods sold, yet most (89%) enterprise managers did not plan on changing the prices.


Fig. 3. Retail trade confidence indicator and its components


 

* Including trade in, maintenance and repair of motor vehicles and motorcycles, their parts and accessories.


The survey of service sector enterprise managers showed that in January, the services confidence indicator decreased by 1ppt. This was influenced by more pessimistic expectations for service demand in the coming 3 months: a decrease in demand was expected by 23, an increase – 16% of enterprise managers (a month ago, 10 and 17% respectively). The largest decrease in demand is expected in enterprises engaged in transportation and storage, food and beverage service activities.


However, in January 2017, against December 2016, an increase in service demand was observed: an increase in demand was indicated by 26, a decrease – 8% of enterprise managers (a month ago, 19 and 9%). The business situation of service enterprises slightly improved: in January, improvement was indicated by 19, deterioration – 5% of enterprise managers (a month ago, 15 and 5%).


Nearly three quarters (73%) of the respondents did not plan on changing the number of employees, while 17% – planned on hiring new employees. An increase in prices for services in the short run was expected by 8, a decrease – 4% of the interviewed, while 88% of the enterprise managers did not plan on changing the prices.


Fig. 4. Services confidence indicator and its components



 

Concepts


Balance is an indicator calculated as the difference between positive and negative answers to the questions posed in the questionnaire.


Economic sentiment indicator refers to the weighted arithmetic mean of five components – consumer, industrial, construction, retail trade, and services confidence indicators (their weights making up 20, 40, 5, 5, and 30 per cent respectively).


Services confidence indicator is calculated as a simple arithmetic mean of the balances of the assessment of changes the business situation, the demand for services provided and expected demand.


Industrial confidence indicator is calculated as a simple arithmetic mean of the balances of the assessment of demand, production expectations and the level of stocks (the last with inverted sign).


Retail trade confidence indicator is calculated as a simple arithmetic mean of the balances of changes in the business situation, expectations for the business situation and assessment of the level of stocks (the last with inverted sign).


Construction confidence indicator is calculated as a simple arithmetic mean of the balances of the assessment of demand for construction works and the employment expectations.


Consumer confidence indicator refers to the simple arithmetic mean of the balances of positive and negative answers to four questions (about changes in the financial situation of the household, the economic situation in the country, the number of the unemployed (with an opposite sign), and the probability of making savings in the coming 12 months).






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