KOF Business Situation: Brightening up Again

The rise of the Business Situation Indicator in May is due to the manufacturing industry and the financial and insurance service providers (see G8). The positive business situation in the project engineering sector has also improved slightly. In contrast, the construction industry’s upturn in spring was less substantial than usual and the business situation has somewhat deteriorated. Retailers are also more dissatisfied with their business situation than before. Wholesalers, the hotel and catering sector and the other service providers were last surveyed in April. The business situation in the wholesale and hotel and catering sectors is currently less unfavourable than three months ago. The indicator for the other service providers was subject to slight downward pressure.

From a regional perspective, the business situation has picked up again, especially in North-West Switzerland (see G 9). Following a setback in the previous month, the manufacturing sector in North-West Switzerland, particularly, managed to regain ground. The business situation in Espace Mittelland, Central Switzerland, the Zurich region and Eastern Switzerland has not changed much. In Ticino and the Lake Geneva region, the situation has become slightly less favourable. In the latter region, negative signals are coming especially from the construction sector.

Note:

Graph G 8 presents the KOF business situation across all sectors covered by the survey. The business situation in sectors which are surveyed on a quarterly basis is kept constant during the intervening months.

Graph G 9 presents the business situation and the current changes. In the case of the monthly surveys, the changes over the previous month are highlighted. In the case of the quarterly surveys, the changes between the latest quarterly value and the previous quarter are marked. The quarterly values are updated in the first month of every quarter and are not adjusted during the intervening months.

Graph G 10 presents the business situation in the main regions according to the Federal Statistics Office. The regions are coloured according to business situation. The arrows in the regions indicate the change in the business situation compared to the previous month. An upward-pointing arrow, for instance, indicates that the situation has improved over the previous month.

The KOF business situation is based on over 4,500 reports by Swiss companies. Every month, businesses are surveyed in the following sectors: industry, retail trade, construction and project engineering as well as financial and insurance services. Businesses in the hotel and catering sector, wholesalers and the other service providers are surveyed in the first month of every quarter. Among other questions, the businesses are asked to assess their current business situation. They may rate their situation as ‘good’, ‘satisfactory’ or ‘bad’. The balance of the current business situation is the percentage difference between the ‘good’ and ‘bad’ responses.