Businesses Improve Their Still-Guarded Economic Expectations – Business Outlook Survey in August

In August, businesses retained guarded expectations of their economic performance, although improving them both on the previous month and year-on-year. Companies across all of the surveyed sectors softened their expectations.

Drivers of positive impulses were brisk consumer demand, energy stability, decelerating inflation, and seasonal factors. In contrast, continued destruction of production facilities and infrastructure, significant costs for reconstruction, raw materials and labor, along with higher electricity tariffs for businesses and a shortage of skilled workers, were all slowing economic activity and negatively affecting respondents’ expectations.

This is evidenced by the business activity expectations index (BAEI), which the NBU calculates on a monthly basis, apart from a forced break in March–May 2022. The BAEI was 49.0 in August 2025, up from 48.3 in July 2025, being above the figure of 48.4 for August 2024.

Thanks to sustained domestic demand and seasonal factors, construction companies have had a positive economic outlook for four months running, reporting the most optimistic expectations of all sectors, the sector’s index being 54.0 in August, compared to 50.6 in July 2025 and 50.7 in August 2024. Respondents expected a further increase in construction volumes, the number of new orders, and in purchases of raw materials and supplies. Respondents said they intended to purchase more contractor services on the back of weaker growth expected in the cost of these services. Respondents continued to soften their guarded expectations about the availability of contractors.

Trading companies have reported a positive economic outlook for six months in a row, due to brisk consumer sentiment and the expanding supply of goods resulting from the new harvest coming onto the market, the sector’s index being 51.8 in August, compared to 51.2 in July 2025 and 50.4 in August 2024. Respondents expected a further increase in trade turnover and in the amount of goods purchased for sale. In contrast, trading companies were more pessimistic about their stocks of goods for sale. As before, respondents declared intentions to cut their trade margins.

Industrial companies retained guarded expectations of their performance amid ongoing destruction of production facilities and significant costs for reconstruction, raw materials, and labor: the sector’s index was 48.7 in August, compared to 48.6 for each in July 2025 and August 2024. Respondents continued to expect an increase in the amount of manufactured goods and in the number of new orders for products. Industrial companies were less pessimistic about the number of new export orders for products, the amount of unfinished products and finished goods stocks. Conversely, respondents expected a further drop in their stocks of raw materials and supplies.

Although softening their expectations slightly, services companies retained the most guarded expectations of their economic performance, due to complicated and expensive logistics, higher electricity prices and a shortage of qualified staff, the sector’s index being 47.0 in August, compared to 45.8 in July 2025 and 46.5 in August 2024. Respondents expected a decline in the amount of services provided. At the same time, they were less downbeat about the number of new orders for services and the amount of services that are being provided.

On the back of expected slower growth in purchase prices, construction, trading and services companies declared intentions to raise their selling prices at a slower pace. In contrast, industrial companies said they intended to raise their selling prices at a slightly faster pace.

The labor market situation remained uneven. Only construction companies reported intentions to expand their workforces, while companies in other sectors said they intended to lay off staff.