May figures in business environment mostly negative in Latvia

Data of business tendency surveys published May 31 by the Central Statistical Bureau (CSB) show that in May 2022 business confidence indicators were negative in the construction, manufacturing, and services sector. Only the business environment in retail trade still remains positive.

Business confidence indicators characterize the general situation in the sector and they are acquired by carrying out business surveys in the industry, construction, retail trade, and services sectors. If the indicator is above zero, the business environment is positive, if it is below zero – the business environment is negative.

In May 2022 confidence indicator in retail trade, according to seasonally adjusted data, comprised 1.4. As compared to April, this indicator has dropped by 0.6 percentage points. The business environment was positive in all sub-sectors of retail trade.

In the services sector, the seasonally adjusted confidence indicator in May 2022 was negative (- 2.4) and the business environment of entrepreneurs has improved by 0.5 percentage points, compared to April. As usual, indicators of the environment differ significantly in various services sectors, and also trends of their changes differ depending on the specificities of the sector and seasonal impact.

In May confidence indicator in construction, according to seasonally adjusted data, is -15.2 which, compared to the previous month, has worsened by 1.1 percentage point. In May, compared to April, the assessment of enterprises regarding the expected development of employment in the next three months was less optimistic. The confidence indicator is negative in the construction of buildings and civil engineering, and positive – in specialized construction activities.

In May, compared to April, confidence indicator in manufacturing has grown by 0.6 percentage points and comprises -2.7. It was affected by a slightly more positive assessment of enterprise managers regarding level of current orders, as well as larger decrease in stocks of finished products.

In May 2022 economic sentiment indicator comprised 94.4, (95.0 – in the previous month). Economic sentiment indicator characterizes the general socio-economic situation in the country during a certain period of time (month), and it is calculated by the European Commission, Directorate-General for Economic and Financial Affairs for all EU countries according to a common methodology, taking 15 various seasonally adjusted components included in industry, construction, retail trade and services sector, as well as in consumer confidence indicator, as a basis.

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