The economic sentiment index strengthened slightly in June, as it stood at 108.3 points, up from 107.7 points in May, according to an announcement by IOBE.
This improvement stems from stronger expectations in Retail trade and Services, with the other sectors, Industry and Construction, moving mildly downward, while consumer confidence remained at the levels of the previous month.
In Construction, the upward course of recent months is interrupted, mainly due to Private construction, while in Retail trade there is a significant strengthening, due to mildly optimistic assessments for current and future sales.
In Services, a strong improvement is recorded, due to the optimistic forecasts of all the individual factors that make up the relevant index. In Industry, expectations for production in the coming months show a significant weakening.
On the household side, Greek consumers express slightly more optimistic forecasts for their household finances compared with the previous month and for the overall economic situation in the country, but their intention for major purchases declines sharply, with the result that overall consumer confidence remains unchanged.
The crisis in the Middle East remains the main source of uncertainty for the European economy, especially through inflation, a fact that was also reflected in the increase in interest rates by the ECB. The ceasefire and temporary agreement between the US and Iran leads to a significant easing of pressures in the energy markets.
The smooth resumption of shipping constitutes a critical link so that pressures on international trade and inflation may be further reduced. The rise in production costs in previous months led to price increases with an impact on households' disposable income.
In tourism, while we are in the central period, the slowdown is estimated, for the time being, to be small. The economic climate in the coming months will be affected on the one hand by whether there will be an end to the crisis in the Middle East and on the other by domestic trends, also in view of the pre-election period.
In more detail:
- in Industry, the balanced balance of assessments for orders and current demand weakened mildly, the positive balance of forecasts for production in the coming months declined slightly, while the level of inventories remained essentially unchanged.
- in Construction, the positive forecasts for companies' work program weakened slightly, while the positive forecasts for employment declined more strongly.
- in Retail Trade, positive assessments for current sales strengthened slightly, as did forecasts for their short-term development, with inventory levels easing mildly.
- in Services, positive assessments for the current situation of businesses strengthened mildly, as did positive assessments for current demand, while at the same time forecasts for its short-term development moved strongly upward.
- in Consumer Confidence, households' negative forecasts for the country's economic situation were reduced, as were those for their own financial situation. At the same time, forecasts for major purchases declined sharply, while the intention to save improved mildly.