Business confidence improves, consumer sentiment weakens

Analysis

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Economic research institute GKI's combined gauge of business and consumer confidence edged up to -0.6 points in August from -1.1 points in the previous month, supported by an improvement in sentiment among companies, according to a report by state news wire MTI.

GKI's business confidence index rose to 6.1 points from 4.4 points.

Among industrial companies, the outlook for production, orders, and inventories improved, as did assessments of production in recent months.

In the construction sector, building companies' outlooks improved as outlooks for civil engineering companies continued a gradual deterioration. Companies said the labor squeeze and a shortage of materials are their biggest challenges.

Sentiment in the commerce sector worsened for the second month in a row as companies were less optimistic about their sales positions but delivered better assessments of inventories.

Companies in the service sector said the climate for doing business was better, but still expected lower sales.

GKI's consumer confidence index fell to -19.7 points in August from -16.9 points in July. Households said their financial situation "improved slightly". More said they could make savings, but fewer said they planned big-ticket purchases.

GKI's economic sentiment survey is supported by European Union funding.

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