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Business Barometer: Deepening Pessimistic Expectations and Sectoral Challenges in October 2024
In October 2024, the overall Business Barometer Index dropped to 40.3 points, showing a decline of ⇩-2.2 points compared to the previous month. This is the lowest value recorded since the beginning of regular observations in October 2023.
Improvement is forecasted only in the construction sector, where the Business Barometer Index stands at 55.0 points, though the number of optimistic entrepreneurs continues to decline for the second consecutive month (⇩-2.3).
A notable increase in negative expectations was recorded in the trade sector (40.4⇩-4.4), although the situation is perceived by businesses as slightly better than in the manufacturing and services sectors.
The services sector remains in the zone of negative expectations, with a slight intensification (40.3⇩-0.5).
In the manufacturing sector, businesses exhibit the most cautious outlook, and the number of skeptics is increasing (38.6⇩-1.8).
Negative expectations dominate across businesses of all sizes. The most significant rise in pessimism is observed among large businesses (45.0⇩-12.5). Micro, small, and medium-sized enterprises hold an even more cautious view of the future than large businesses (Barometer values below 43 points), with medium-sized businesses showing the lowest Barometer value (37.6⇩-3.9).
Exporters’ outlook on the future follows the general trend in the business sector, marked by an increase in pessimistic expectations (37.5⇩-3.9).
According to the survey results on “What tax increase would be fair for boosting the budget?”, the majority of respondents are against raising taxes, while a notable portion supports an increase in VAT. Specifically, 48% of respondents believe that none of the taxes should be raised, while 26% think that VAT can be increased.
Monthly, in addition to the regular survey, respondents can answer the “hot” question of the month and contact the hot line of the Ukrainian Chamber of Commerce and Industry.
The survey is conducted in verified chatbots on Telegram and Viber and takes only 2 minutes.
The October 2024 report is available here.
The Business Barometer from the Ukrainian Chamber of Commerce and Industry (UCCI) represents the perspectives of enterprises and entrepreneurs who are members and partners of the UCCI.
It reflects expectations for changes in the business environment in the coming month compared to the previous one.
Based on a survey that considers the status of indicators (or "sub-indices") of the respondents' activities across four sectors (manufacturing, construction, trade, services), the Business Barometer is tailored to meet the needs of the members and partners of the Ukrainian Chamber of Commerce and Industry. A distinctive feature of the Business Barometer is the inclusion of specialized industry questions and an analysis of export conditions, which provides additional insights into market conditions.
* - Extra questions that are not considered in the calculation of the Business Barometer.
The Business Barometer is calculated using the PMI methodology (Purchasing Manager Index):
PMI = (P1 * 1) + (P2 * 0,5) + (P3 * 0)
where:
P1 = % of responses indicating an improvement
P2 = % of responses indicating no change
P3 = % of responses indicating a deterioration
A value above 50 signifies growth or expansion in the economic sector compared to the previous month.
A value below 50 indicates a contraction.
A value of 50 indicates that there is no change compared to the previous month.
Attention! The indicators "Purchasing Prices" and " Unfulfilled Order Volume/Inventory Levels" are considered deterrents and are interpreted inversely in the calculation.
To detail the provided responses, a 5-point scale is used (will decrease – likely to decrease – no change – likely to increase – will increase).
For calculating the Business Barometer indicator, a 3-point scale is applied, and responses are summed up as follows:
