Latest news with #BusinessConfidenceSurvey
Business Recorder
7 days ago
- Business
- Business Recorder
Business confidence: Fragile faith
'...inflation expectations increased slightly for consumers but declined for businesses in the latest sentiment surveys…' reads an excerpt from the central bank's July 30, 2025, Monetary Policy Statement. 'Supported by easing financial conditions, positive business sentiments and a gradually strengthening macroeconomic environment, real GDP growth is projected to rise to 3.25 – 4.25 percent this year….', reads another. It would have been good — if it were true. SBP's own Business Confidence Survey shows inflation expectations among businesses hitting two of their highest readings in recent years in the last two survey rounds. Yet this is precisely where the central bank saw a 'decline' worth highlighting. And it's not as if the SBP was teeing up a rate cut to make the framing at least politically convenient — it wasn't. July 2025 Business Confidence Index (BCI) slipped to its lowest since December 2024. Calling business sentiment 'positive' is technically accurate — in a diffusion index, anything above 50 counts — but the trend is hardly reassuring. The BCI has fallen for two consecutive months, only the third such losing streak in the past 30 months, and the direction of travel is unmistakably downward. The Purchasing Managers' Index (PMI), a key sub-component of the BCI — saw its steepest-ever month-on-month drop, plunging 4.8 percentage points. At a six-month low in July 2025, the PMI reflects weakening across the board: past six months' production, headcount, order books, and raw material purchases all lost ground. Industry capacity utilization has barely budged over the past year, which is still more than 600 basis points below where it stood at the start of 2024. The lackluster LSM growth numbers tell the same story, matching the subdued tone of business sentiment. Looking ahead, there isn't much for businesses to cheer. Expected demand for credit over the next six months is at a six-month low, while hiring plans aren't exactly inspiring. In manufacturing, sentiment on the rupee-dollar parity has slumped to its weakest since September 2023. Yes, the macro indicators have improved, and some high-frequency data suggest a modest recovery. But that has yet to translate into a sustained lift in business sentiment — something official communication would do well to acknowledge.
Express Tribune
11-08-2025
- Business
- Express Tribune
Despite challenges, business confidence rises
Since the main beneficiary of the project would be KPT, a business and financing plan could be developed in collaboration with port authorities and the Ministry of Maritime Affairs, the cabinet committee said. photo: file The confidence of Pakistan's private businesses has surged to its highest level in nearly four years, according to the latest survey of Gallup Pakistan. Also, an increasing number of businessmen have started thinking that the government is managing the economy in a better way than the previous administration. The improvement comes despite inflation, high utility costs and electricity load-shedding, which continue to hinder business operations. The Business Confidence Survey for the second quarter of 2025 was conducted between July 23 and 27, capturing the views of 524 businesses across manufacturing, services and trade sectors. The standout finding is a significant rebound in perception of the country's overall direction. The "Direction of the Country Score" now stands at -2%, a sharp improvement from the far more pessimistic readings of late 2024. While the score remains marginally negative, it marks the highest level of confidence in national direction since Q4 2021. "This uptick suggests a moderate easing of political and economic uncertainty from the perspective of the business community," the survey said. The number of businesses holding a good perception about the government's ability to manage the economy has improved over the past year. According to the survey, 46% of businessmen called the government's management of the economy better than its predecessor, compared to 24% a year ago. Commenting on the survey, Gallup Pakistan Executive Director Bilal Ijaz Gilani said the latest edition was pointing to a "cautiously improving mood" among Pakistani businesses. "While the shift is incremental, it reflects a growing sense of stabilisation among economic actors," he said. The most visible change, Gilani said, was improvement in perception of the direction of the country and also the positive trend in trust in the government's handling of the economy. "As always, sustained momentum will depend on continued macroeconomic reforms, policy consistency and greater institutional responsiveness, especially towards businesses operating outside the formal sector," said the official. Business performance was another area that showed encouraging signs as 61% of respondents described their current operations as "good" or "very good," up six percentage points from the previous wave. While services and trade enterprises reported the largest gains, the respondents from the manufacturing sector underscored comparatively slower signs of recovery. The survey found 61% of businesses optimistic about the coming months, with the Future Business Confidence score improving by just one percentage point. "This indicates that while businesses are not anticipating worsening conditions, there is also limited momentum for stronger optimism at this stage," the survey said. Asked about challenges, the businessmen cited price hike, high energy costs and taxes as their biggest concerns, which shows the structural challenges remain deeply entrenched in Pakistan's business sector. The Consumer Price Inflation, which eased to a record 0.3% in April from 38% in May 2023, emerged as the most pressing issue, cited by 28% of respondents as the top priority for government action. High utility costs, 18%, while concerns over taxation, 11%, exhibited a slight decrease from last year's levels. Energy insecurity also continued to affect operations as nearly half, 47%, of those surveyed said they were experiencing load-shedding on the day of the interview. "While still a concern, this figure is lower than during the same quarter in prior years, indicating some potential seasonal or regional relief," said the survey. Overall, the survey indicates a measured improvement in private sector sentiment, especially regarding businessmen's perceptions of national direction and current business operations.
Business Recorder
07-05-2025
- Business
- Business Recorder
Confidence, Misplaced?
'...recent surveys suggest further improvement in both consumer and business sentiments…' reads an excerpt from the central bank's May 2025 Monetary Policy Statement. The State Bank of Pakistan appears to be in good spirits. In the previous monetary policy announcement back in March, policy rates were held steady, and the Business Confidence Index (BCI) had seen a 3 percentage point jump from the earlier reading. Fast forward to May, and the latest survey tells a more sobering tale: the BCI is now down 120 basis points from the last survey, and up by a mere 0.3 percentage points since March — hardly the kind of trend you'd cite to build a case for improved sentiment. Clearly, all eggs seem to have been placed in the national headline inflation basket — and to be fair, there are valid reasons for doing so. But there's a difference between leaning on data and bending it to fit a preferred narrative. Truth be told, the latest Business Confidence Survey spells more warning signs than green shoots, and it's a stretch to list it among the 'key developments' influencing monetary policy direction. A closer look shows that three of the four sectors covered in the April 2025 survey report a deterioration in sentiment versus February. Manufacturing has inched forward — but by just 0.2 percentage points. Meanwhile, construction, services, and wholesale & retail have all logged moderate to significant declines. While the Current Business Confidence — which looks back over the last six months — is largely unchanged from February, the Expected Confidence for the next six months has taken a visible hit. The index is now at its lowest level since October 2024. More worryingly, inflation expectations over the same future horizon have worsened, reaching their highest point since August 2024. In the manufacturing sector, sentiment around the rupee-dollar parity is now the lowest since July 2024. Expectations for production in the next six months have slid to a six-month low, and current capacity utilization is down over 2 percentage points since February. Year-on-year, the improvement is just a shade over 1 percentage point. None of this screams collapse — but none of it suggests robust recovery either, certainly not the sort you'd highlight three times in a policy statement as a silver lining. Then there's the MPS mention of 'increasing electricity generation' as an indicator that 'economic activity is maintaining momentum.' But when you're running a marathon and still circling the track from 2018, it's hard to call it momentum. Most generation figures remain at or below 2018 levels, and one-off growth of 3 percent year-on-year for a single month is hardly a reliable signal of sustained pickup. Finally, the MPS once again points to low-weight LSM segments, like furniture, as draggers of growth — and rightly so. The furniture sector, with just a 0.51 percent weight, has managed to wipe out nearly all the gains from the so-called 'key segments' such as garments, textiles, pharmaceuticals, and automobiles. That said, one wonders what to make of non-so-key sectors — food, beverages, chemicals, cement, steel — all deep in red, and together heavier in combined weight than the celebrated ones.
Express Tribune
17-02-2025
- Business
- Express Tribune
Business confidence in economy rises
LAHORE: Pakistani businessmen are gaining confidence about the prospects of their businesses that they believe are improving, shows a latest survey. However, a majority of them are still of the opinion that the country is not heading in the right direction, a perception that, according to the survey report, may be reflective of the overall political situation in Pakistan and less linked with economic management. According to the Gallup Pakistan Business Confidence Index Q4 2024 survey report, 55% of businessmen think of their businesses doing very good or good these days. This shows a 10% increase in their perception over the previous survey conducted about six months ago in the second quarter of 2024. The fieldwork did not happen in the third quarter. The number of businesses which used to rate themselves as very bad declined 7%. The manufacturing sector seems to have recovered less than the services and trade sectors when it comes to rating the current business situation, the report said. About the future, the business community is more optimistic as their score has risen 19% from six months ago. Some 60% businesses in the Q4 survey showed positive expectations about their future while 40% expected things to worsen. The Net Future Business Confidence score has increased 36% since the second quarter of 2024. "Reduction in inflation, macroeconomic stability and interest rate cuts contribute to a large decrease in business pessimism," the survey report mentioned. The number of such businesses fell 20% from the previous survey as the index improved from negative confidence to poor confidence, as defined by Gallup in its methodology. "Overall trend for the past few quarters has been consistently negative, however, there is some improvement in the current quarter," the report said. Responding to a question about which government managed the economy well, 41% of the businesses surveyed named the ruling Pakistan Muslim League-Nawaz (PML-N) while 38% rated the administration of former prime minister Imran Khan as better managers. Twenty-one per cent saw no difference in the performance of the two governments. The backbreaking inflation, which erodes the purchasing power of consumers, was cited as the most critical problem, which 30% of businessmen wanted the government to resolve. "More service-providing businesses than manufacturers and traders reduced their workforce," the survey results showed. Overall, the report said, all the three strands of the Gallup Business Confidence had seen an improvement since the second quarter of 2024, showing that there was growing optimism in the business community. The latest survey is the 14th edition of the quarterly Business Confidence Survey conducted in more than 30 districts of the country, covering 482 small, medium and large businesses.
