KOF Business Situation: Slight Recovery

The positive trend in the KOF Business Situation Indicator in November was dominated by a favourable course of business in the manufacturing industry and the retail trade (see T 1). In both sectors, the Business Situation Indicator more than offset its decline of the previous month. The business situation among financial and insurance service providers is largely unchanged. In the construction and project engineering sectors, the business situation slowed down slightly in November. Wholesalers, the hotel and catering companies and the other service providers were last surveyed in July. At the time, all three sectors reported a slight improvement of their business situation.  

The business situation has improved in the majority of the major FSO regions. The Situation Indicator rose specifically in Eastern Switzerland, Central Switzerland and Espace Mittelland (see G 8). In North-West Switzerland and the Zurich region, the business situation improved very slightly. The Lake Geneva region and, to a larger extent, Ticino did not follow November’s generally positive trend.

Explanation

Graph G 7 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 8 presents the business situation in the main regions pursuant to the Federal Statistical Office (FSO). 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, companies 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 on a quarterly basis in the first month of each quarter. Among other questions, the companies are asked 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”.