NSI: The Total Business Climate Indicator Decreased by 0.8 Points in February 2020

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Bulgaria business indicator

In February 2020, the total business climate indicator decreases by 0.8 percentage points compared to the previous month as a result of the more unfavourable business climate in retail trade and service sector, the National Statistical Institute (NSI) said in a press release.

The composite indicator ‘business climate in industry’ preserves its January level. The industrial entrepreneurs assess the present production activity as slightly reduced and their expectations about the activity over the next 3 months are also worsened.
The main factors limiting the enterprises remain the shortage of labour and uncertain economic environment.
As regards the selling prices in industry, the majority of the managers foresee preservation of their level over the next 3 months.

In February the composite indicator ‘business climate in construction’ increases by 0.5 percentage points as a result of the improved construction entrepreneurs’ expectations about the business situation of the enterprises over the next 6 months. At the same time, their forecast about the construction activity over the next 3 months are more favourable, which according to them will lead to additional hiring of personnel.
The shortage of labour, uncertain economic environment and competition in the sector continue to be the most serious obstacles for the business and in the last month the negative influence of the second factor is reported as increasing.
Concerning the selling prices, there is intention for certain increase, although the prevailing of the managers expect them to remain unchanged over the next 3 months.

The composite indicator ‘business climate in retail trade’ decreases by 0.6 percentage points, which is due to the shifting of the retailers’ assessments about the present business situation of enterprises from ‘good’ towards ‘satisfactory’ (normal for the season). However, their forecasts about the business situation over the next 6 months are more favourable and they expect improvement in the volume of sales over the next 3 months.
The main difficulties for the development of the activity remain competition in the sector, insufficient demand and uncertain economic environment.
As regards the selling prices, the retailers’ expectations are for preservation of their level over the next 3 months.

In February the composite indicator ‘business climate in service sector’ drops by 3.6 percentage points as a result of the more unfavourable managers’ assessments and expectations about the business situation of the enterprises. Their opinions about the present and expected demand for services are more reserved. The competition in the sector continues to be the most serious problem. Second and third factors are ‘uncertain economic environment’ and ‘shortage of labour’. The majority of the managers expect preservation of the selling prices in the service sector over the next 3 months.