Consumer, business confidence declines

The GKI-Erste combined consumer-business confidence index fell to -21.7 points in April from 18.5 points in March as sentiment of both companies and households worsened. The business confidence index declined to -15.6 points in April from -11.9 points in March. Industrial companies were the most pessimistic since the autumn of 2009 as their outlook for production and assessment of order stock - with the exception of exports orders - worsened. Industrial companies had an improved assessment of inventories. Sentiment among trade companies also worsened. The outlook for sales positions and orders deteriorated, but they were more upbeat about inventories. Service sector companies' confidence declined as their assessments of business trends and turnover worsened. Slightly improved sentiment was seen among construction companies as assessments of order stock and business in the preceding three months improved. About half of companies said they were preparing to make layoffs. More industrial companies planned to raise prices, but by a lesser degree than earlier. The proportion of trade companies that plan higher prices fell. Most construction companies expect prices to fall, while more service sector companies see them rising. The consumer confidence index slipped to -38.9 points in April from 37.3 points in March. Households' outlook worsened with regard to the their own financial positions and to the state of the economy as a whole. Fewer planned big-ticket purchases, but more said they could make savings.