Business sentiment among Ukrainian enterprises improved in September, crossing the neutral mark for the first time since July. Businesses reported stable consumer demand and a favorable situation on the foreign exchange market. Still, their optimism is being held back by increased shelling and a shortage of qualified personnel. This is evidenced by the results of the National Bank of Ukraine’s monthly survey.
The general index of business activity expectations (IODA) in September increased to 50.4 from 49.0 in August. An indicator above 50 points indicates that positive expectations in the economy outweigh negative ones.
Positive factors that contributed to optimism:
- Stable consumer demand.
- Stable situation in the energy sector.
- Budget financing for infrastructure restoration.
- Slowing inflation and a stable hryvnia exchange rate.
Negative factors that hinder development:
- Increasing intensity of shelling.
- Significant costs of repairing damage.
- Shortage of skilled workers.
Sentiments across industries vary significantly.
- Trade is the main optimist. Trade firms are showing the highest expectations for the seventh consecutive month. The sector index rose to 54.0. Companies expect further increases in trade turnover, driven by strong demand.
- Construction is in neutral territory. Builders do not expect changes in their activities, although their optimism has cooled somewhat compared to August. The sector index was exactly 50.0. Companies still expect construction volumes to grow, but at a slower pace.
- The industry and Services Sectors are improving their assessments, but remain in the red. Industrialists (index 49.1) and service enterprises (index 49.4) are still pessimistic, but their assessments have improved significantly compared to the previous month. They expect an increase in the volume of products manufactured and services provided.
