March economic data: the good, the bad and the ugly

Capacity utilization rate: not very good

The CUR of the MA (seasonally adjusted) in 1Q21 stabilized around 75.6%, although still at pre-pandemic levels (4Q20: 75.2%, 1Q20: 76.2%, Historical average: 76.0%) .

The CUR of intermediate goods and equipment continued to recover. While durable goods remain on track at pre-pandemic levels, the weak outlook on the CUR for nondurable goods continues.

While the uncleaned CUR continued below pre-pandemic levels, it began to lose potency. Utilization rates for consumption capacity and capital goods have not yet reached pre-epidemic levels. Intermediate goods CUR maintained a positive outlook.

13 of the 23 manufacturing industry sectors changed negatively annually. The steepest drops were seen in the installation and repair of clothing, furniture, and machinery and equipment.

Real sector confidence index: good, very good

The upward trend continues in the MA RKGE, the 1Q21 average was 109.3 (4Q20: 109.2, 1Q20: 103.9, Historical Average: 103.2).

 Confidence indices can range from 0 to 200. Numbers above 100 are optimistic, numbers below 100 are pessimistic; Numbers equal to 100 indicate stable expectations.

Orders, stocks and investment increased on a monthly basis, while the overall trend decreased. Only orders remained below the critical threshold of 100. The optimistic outlook remains. Despite the jump in export orders (since November 2007), total orders weakened.

Service Sector Confidence Index: Good

The service sector confidence index reached the highest level since July 2012. The employment, demand and labor situation indices increased simultaneously. Demand rose to bullish territory for the first time since August 2017. Additionally, all sub-indices are simultaneously above the critical threshold of 100 for the first time since July 2012.

Expectations for prices and number of employees increased for the fifth consecutive month. Especially, the jump in demand expectations is remarkable.

Retail: not bad, but not getting better

The Retail Confidence Index continued above the 100 threshold for the fifth consecutive month. Sales volume and inventory level decreased for the fifth consecutive month.

 The increase in the current stock level index indicates a decrease in stocks, while its decrease indicates an increase in stocks.

All sub-expectations indices remained in the optimistic area. As sales and price expectations increased on a monthly basis, orders and employment expectations for suppliers lost some steam.

Construction Industry Confidence Index: Ugly

The construction industry confidence index decreased for the fourth consecutive month and was the lowest since June 2020. Construction activities returned to the pessimistic zone after 2 months. In addition, the weak outlook for registered orders continued. The downward trend in expectations regarding the number of employees and prices continues.

Extract from the Investment Financing Report

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