Economic sentiment improves in CEE too (02.07.2009)
In June, the Economic Sentiment Indicator (ESI) published by the EU Commission showed an improved economic climate in many CEE countries in line with the trend in the entire EU. Whereas Poland, Slovakia, Hungary and Romania saw an increase in the ESI, the Czech Republic and Bulgaria registered a slight fall over May.
For the entire EU, the Commission report depicts an improvement for the third month in a row. From a low level the ESI increased by 3.2 points to 71.1 (100 = multi-year average). The higher ESI resulted from an improvement in sentiment among consumers and in services, which both rose by 3 points, and in industry, rising by less (1 point). The sentiment in construction remained unchanged and also retail trade remained on a stable level. As the largest EU member states in the CEE region Poland recorded a solid increase in sentiment (plus 2). Just like in Central and Eastern Europe, a majority of EU member countries saw an improvement. The increase observed at country and sector level is mainly driven by improved expectations, as the main economic actors appear to be gaining confidence that the economic crisis is easing. The improved assessment of the business climate over the past 3 months by managers contributed most to this positive development in the EU, while past and expected demand for the services contributed less. The strengthening of the economic outlook for the CEE region is accompanied by estimations for modest GDP growth rates in the markets of Slovakia, Czech Republic, Hungary, Romania, Bulgaria for 2010 whereas crisis-resistent Poland is expected to record a small growth already in 2009. However, experts expect a growing inflation risk to accompany the cyclical recovery in the CEE markets. See here the detailed data and graphs of the latest Economic Sentiment Indicator (ESI) by the European Commission.
