In June 2009 the business inquiries of the National Statistical Institute (NSI) registered a decrease of the total business climate indicator by 1.1 percentage points in comparison with May. The business climate indicator decreases in all the branches with the exception of the service sector.

In June the composite business climate indicator in industry decreased by 2.7 percentage points compared to the previous month. EntrepreneursТ opinions about the present business situation and the expectations about the next 6 months were more pessimistic. The production activity and the orders for domestic market and for export continued to decrease. The expectations about the production activity over the next three months were also more pessimistic. The managers continued to point out the uncertain economic environment and the insufficient demand as the main factors limiting the activity in the branch.

With regard to the selling prices, the managers who expected a decrease of the price level exceeded in number those that expected an increase over the next three months. As a result the balance indicator was negative (-2.9%).

The composite indicator of business climate in construction dropped by 0.9 percentage points in the period under review month on month due to the slightly increased managersТ pessimism about the business situation in enterprises over the next 6 months. The current construction activity was assessed as reduced and the provision of orders for production as insufficient. The data of the business enquiry pointed out that a substantial boost in the construction activity over the next 3 months can not be expected, which was accompanied by pessimistic expectations regarding the personnel.

The uncertain economic environment and financial difficulties remained the main problems for construction enterprises. With regard to the selling prices in construction, there are still expectations about a reduction in their level over the next 3 months.

The composite indicator of business climate in retail trade was 0.7 percentage points lower as of May which is due entirely to the more moderate expectations of the managers about the business situation over the next 6 months. The entrepreneurs consider that the volume of sales over the last 3 months decreased and are expected to keep their current level in the next three-month period.

Managers point out the uncertain economic environment and the insufficient demand as the major factors limiting the activity of the enterprises.

The expectations about the selling prices in retail trade about the next 3 months are that their current level will be preserved.

In June the composite business climate indicator in the service sector increased by 1.5 percentage points compared to the previous month due to the slightly improved managers assessments and expectations about the business situation of enterprises. At the same time the demand of services was assessed as decreased during the last months. The expectations about the next 3 months were less optimistic in comparison with May.

The uncertain economic environment and the competition in the branch are listed as main reasons limiting the activity. Selling prices are expected to drop in the next three-month period.

Source: NSI