In November 2022, the economic situation in the country improved sharply, erasing the deterioration in October, with a more favorable business climate reported in all monitored sectors – in industry, retail trade, construction and in the service sector.
This is shown by the results of the latest survey of the National Statistical Institute (NSI).
The general indicator of the business climate in November rose by 3.7 points, stopping in October, when it decreased by 1.7 points, and the indicator of the economic situation approached its long-term average level.
Graph of the general business climate index
The index, which determines the business climate in industry, increased in November by 0.8% after a drop of 1.3 points a month earlier, with the latest NSI survey reporting more favorable assessments and expectations of industrial entrepreneurs about the business condition of their enterprises. Their forecasts for manufacturing activity over the next three months are also improving.
The main factors hindering the development of this industry continue to be related to the uncertain economic environment and labor shortages, but in November, a reduction in their negative influence was observed.
Managers’ expectations regarding sales prices in industry in the next three months are in the direction of increase, NSI points out.
In November 2022, the indicator “business climate in construction” increased by 2.2 points after an increase of 1.4 in October, improving the assessments of construction entrepreneurs about the current business condition of their enterprises, as well as their expectations for construction activity in the next three months. The latest NSI survey also registered a slight increase in new construction orders received in November.
The main problem for the development of the activity in the industry is the uncertain economic environment, followed by the prices of materials and the shortage of labor.
49.4% of construction managers foresee an increase in sales prices in the next three months.
In November, the composite retail business climate index jumped as much as 8.7 points, offsetting a 5.2-point drop in October, with the sharp improvement due to retailers’ upbeat assessments and expectations about business conditions. Their forecasts regarding the volume of sales and orders to suppliers for the next three months are also improving, the NSI business survey reports.
According to retailers, the main obstacle to the development of activity in the sector is related to the uncertain economic environment, followed by competition in the sector and insufficient demand, and in November there was an increase in their negative impact.
The service sector business climate composite also rose solidly in November by 5.3 points after a 2.3-point decline a month earlier, with the improvement driven by favorable managers’ assessments and expectations about the current and expected future demand for services.
The uncertain economic environment continues to limit business development in this sector to the greatest extent, followed by the “labor shortage” and “competition in branch” factors.
Regarding sales prices in the services sector, managers’ forecasts are for some increase in the next three months.
An improvement in the economic situation in Bulgaria in November is a fact despite the lack of indications of forming a regular official government within the framework of the new parliament and despite the remaining negative consequences related to the war in Ukraine – mainly the still high energy prices and inflation.
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