The National Bank published a survey of company executives in the first quarter of 2023 about business, as well as inflation forecasts.
The business softened negative expectations about its own business activity, as well as improved inflation and exchange rate estimates. This is confirmed by the results of a survey of company executives in the first quarter of 2023, the NBU press service reports.
The Enterprise Business Expectations Index (BII) increased to 91.2% compared to 83.5% in Q4 2022 (hereafter referred to as Q4). The improvement in estimates occurred in enterprises of almost all types of economic activity (FEA), except construction and trade, as well as for all components of the index. The business significantly softened the negative expectations of the dynamics of the production of goods and services in Ukraine in the next 12 months.
Inflation expectations have also improved: in 2023 Q1, expected annual inflation is 20.7% compared to 23.3% in the previous quarter. 46.8% of surveyed businesses believe that inflation in the next 12 months will not exceed 20%. The share of those expecting inflation to exceed 30.0% decreased significantly to 16.2%. According to 88.4% of respondents, the most significant pro-inflationary factor is military operations.
Despite the softening of respondents’ assessments of the current financial and economic situation of their own businesses for the third consecutive quarter, the overall assessment remains negative: the balance of answers is “minus” 16.9% compared to to “minus” 19.3% in the fourth quarter.
Extractive industries expect improvement over the next 12 months. Agricultural enterprises predict their financial and economic condition at the current level. The rest of the respondents (excluding construction companies) softened their negative expectations.
For the first time in a year, respondents expected an increase in sales volume, including in the foreign market.
Respondents continued to dampen negative expectations of investment spending on both construction work and machinery, equipment and inventory. Companies that attracted foreign investment in the second quarter expect an increase in their volumes over the next 12 months.
The quarterly survey was conducted from January 30 to February 28, 2023. The survey included 644 enterprises from 21 regions of the country (excluding the temporarily occupied territory of the Autonomous Republic of Crimea, as well as Donetsk regions , Lugansk and Kherson).
As we have already reported, within the framework of the EU Single Market program, Ukrainian business will receive 7.5 million euros from the European Commission.
In addition, Ukraine will receive UAH 367 million from USAID for the processing of agricultural products.
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Source: korrespondent
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