KOF Business Situation: Indicator Dips Slightly

The Business Situation Indicator dipped slightly in most sectors. For instance, there has been a minor slowdown in the construction, project engineering and retail industries, while the financial and insurance sector suffered a slightly stronger decline. Bucking the downward trend, the manufacturing industry reported a small upward movement for the tenth consecutive month. All in all, the business situation in the manufacturing industry is predominantly positive. Wholesale, hotel & catering and the other services were last surveyed in October. At the time, the wholesale and the hotel & catering sectors reported an improvement of their business situation. The indicator for the other service providers dropped slightly.

At the regional level, the business situation changed very little in the majority of regions. Espace Mittelland, Eastern Switzerland, Central Switzerland and the Zurich Region all reported a similar situation to that of the previous month. The indicator dropped slightly more noticeably in Ticino and in North-West Switzerland. The Lake Geneva region recorded a rise in the Business Situation Indicator.

Explanation

Graph G 6 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 7 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”.