On Thursday 13 June, the RMB/BER Business Confidence Index for Q2 cast a new shade of gloom over hopes that the economy was rebounding after shrinking by 3.2% in Q1.The RMB/BER Business Confidence Index flatlined at a worryingly low 28 in the second quarter. More than seven out of 10 respondents, therefore, remained unsatisfied with current business conditions.
Building sentiment improved by seven index points to a still low 30 – a level that remains consistent with an absolute scarcity of new work. Retail confidence rose by a modest four points from 24 to 28 in the second quarter. Sales volumes remained weak across the spectrum of retailers,” RMB said.A standout from the second quarter BER survey results was the ongoing worsening in business activity from an already depressed level.
Manufacturing production increased 4.6% in April year-on-year, which has generally been seen by economists as a positive sign since it is the economy’s fourth-biggest sector. Its 8.8% contraction in the first quarter was a key factor behind the Q1 slide in gross domestic product . But it was also recovering from the power cuts that marred Q1 and domestic demand for its products remains subdued, to say the least.