KOF Business Situation: Further Improvement

With numerous sectors contributing to the improvement of the business situation, the rising trend has a broad basis. The upturn in the retail and manufacturing industries is significant, while the business situation in the construction sector and the financial and insurance sectors picked up slightly (see T 3). The situation in the project engineering sector is more or less stable. Wholesale, hotel and catering and the other service providers were last surveyed in April. At the time, the wholesalers and the other service providers reported a substantial improvement of their business situation. The indicator in the hotel and catering industry rose slightly.

From a regional perspective, the business situation brightened up in the majority of the main FSO (Federal Statistics Office) regions, reflecting the improvement on a broader regional basis (see G 5). The indicator rose in the FSO regions of Central Switzerland, North-West Switzerland, Eastern Switzerland, Espace Mittelland and the Lake Geneva region. The decline of the indicator in Ticino is the exception. However, in this region, the business situation indicator had risen significantly in the preceding month. The Zurich region reported little change in the situation in June.

Explanation

Graph G 4 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 5 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 more than 4,500 reports from businesses in Switzerland. Each month businesses are surveyed in the economic sectors of industry, retail trade, construction, project engineering and financial and insurance services. Businesses in the hotel and catering sector, wholesalers and other service providers are surveyed quarterly in the first month of each quarter. Businesses are requested, amongst other things, to assess their current business situation. They may class their situation as “good”, “satisfactory” or “bad”. The balance of the current business situation is the percentage difference between the answers “good” and “bad”.