KOF Business Situation Indicator: Companies More Satisfied

The improvement of the business situation is due to a more favourable appraisal of the situation in the manufacturing sector. Financial and insurance service providers are also more satisfied with their situation than in the preceding month. The positive situation in the construction and project engineering sectors is mostly unchanged. The more unfavourable situation in the retail trade has also hardly changed compared to the previous month. Wholesalers, hotel and catering businesses and the other service providers were last surveyed in July. Both the wholesale trade and the hotel and catering industry had reported a significant improvement of their business situation at the time. The indicator for the other service providers declined slightly.

From a regional perspective, the Business Situation Indicator has risen, or at least remained about the same, in almost all of the main FSO (Federal Statistical Office) regions (see G 6). Only the Lake Geneva region reported a slowdown of the business situation. An improvement was reported in Ticino, Central Switzerland, North-West Switzerland and Espace Mittelland.  In the Zurich region and Eastern Switzerland, the situation hardly changed in August.

Explanation:

Graph G 5 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 6 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”.