02.11.2022

The Economic Downturn is Consolidating

Results of the WIFO-Konjunkturtest (Business Cycle Survey) of October 2022
The results of the WIFO-Konjunkturtest (business cycle survey) show a further clouding of economic sentiment among Austrian companies in October. At 2.9 points (seasonally adjusted), the WIFO Business Climate Index was 2.4 points below the value of the previous month (5.3 points), only just in positive territory. The assessments of the current situation deteriorated further but remain in positive territory. However, business uncertainty rose to new highs. Economic expectations deteriorated further and signal pessimistic economic outlooks.

The current situation index lost 1.7 points in October but remained positive at 7.9 points. In the manufacturing sector, which is particularly sensitive to economic developments, the situation index lost 4.6 points compared to the previous month and remained only just in positive territory at 5.8 points. In the construction industry the situation index gained 1.8 points and remained above average at 23.7 points. In the service sectors the index lost 1.5 points compared to the previous month, but still remained above the zero line with a value of 9.1 points. In the retail sector, the situation index rose by 2.4 points, but at –8.2 points it remained in the range of very sceptical economic assessments.

The index of business expectations continued to lose momentum in October (–3.1 points). At –2.2 points, it was below the zero line separating negative from positive economic expectations for the first time since March 2021. In the retail sector, the expectations index gained 4.1 points, but remained clearly in negative territory at –20.0 points. In the service sectors, the expectations index fell (–3.4 points) to –1.5 points below the zero line. In the construction industry, on the other hand, the expectations index rose by 2.2 points to an optimistic 35.8 points. This increase is mainly due to the high price expectations. The business situation expectations in the construction industry have already been in negative territory since May. In the manufacturing sector, which was particularly affected by the rise in energy prices, the expectations index fell significantly (–7.0 points). At –10.0 points, it was noticeably below the zero line in the pessimistic range.

WIFO-Konjunkturtest
28.10.2022
Results of the WIFO-Konjunkturtest (Business Cycle Survey) of October 2022
Finalization: October 2022
Contractor project: European Commission
Specialist publication: WIFO-Konjunkturtest
Dr. Werner Hölzl
Industrial, Innovation and International Economics