K&H Bank SME index slips in Q1 because of pre-election jitters
K&H Bank Rt’s SME confidence index slipped to -4 from 4 in the first quarter of 2006, the bank, together with market research company GfK Hungária, announced on Wednesday.
The report attributed the fall in confidence to jitters before Hungary's April elections and expectations of rising interest rates. SMEs also said they were counting on higher taxes in the coming year.
The index's main component, which measures expectations for monetary policy, fell 23 to -42 in Q1 2006 because of growing expectations of rate rises. SMEs said they anticipated corporate lending rates to increase 1.5 percentage points. In the previous five quarters, they said they expected rates to rise 0.6 percentage points on average.
About 51% of SMEs said they expected the forint to weaken, more than in the previous quarter. The component of the index measuring the government's economic policy fell 6 to -18 in the first quarter.
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.