For several months in a row, a consistent growth of the Industrial Expectations Index | Business

Even if the improvement was not significant, a continuous improvement in the assessment of the business environment of industrial companies has been observed since the beginning of this year. In the first quarter of this year, production forecasts were very positive, optimism decreased somewhat in April, but companies are already predicting an increase in the number of employees and are quite positive about demand.

According to LPK president Vidmantas Janulevičius, the situation in the industrial sector is stabilizing, but very slowly.

Company photo/Industry Expectations Index

“A certain improvement in the situation is due to the falling energy prices, which has a positive effect on the chemical industry, and in addition, the situation in the wood and furniture sectors is improving. Decreasing inventories in the euro area encourage manufacturers to increase production of final products, which generates more orders for Lithuanian manufacturers and improves export expectations.

In addition, we expect an additional breath of fresh air due to the eventual launch of the RRF measures, which should improve access to capital and provide an impetus for new investment and the much-needed transformation, both green and energy, as well as increasing worker productivity. And in the end, if the European Central Bank makes the long-awaited decision in June and the interest rates really start to decrease, it will be an additional stimulus to stimulate the economy”, notes the president of LPK.

Unfortunately, the number of available orders is not increasing significantly, but it is not decreasing either. So far, the industry’s main concern is insufficient demand, but concerns about staffing are also starting to grow.

Confidence is growing that exports will grow over the next three months, even though around four out of ten industrial companies are currently unsatisfied with export demand.

Production capacity utilization in April. reached 70.2 percent. and it was only the third month since the start of 2023 that capacity utilization reached 70 percent. Lower than average capacity utilization in industrial enterprises in April. fixed in the production of other non-metallic mineral products (42.1%), furniture production (59.4%), computer, electronic and optical products production (60.0%), chemicals and chemical products production (63.3%). ) and rubber and plastic products production (67.1%) sectors.

Better-than-average industry-wide expectations for April. were fixed in the sectors of computer, electronic and optical products production, metal products, rubber and plastic products production, other non-metallic mineral products production, food products and textile products production sectors.

The highest recorded value of the industrial expectations index was 54.5 (May 2021) and the lowest ever recorded was 38.9 (April 2020). The index has been compiled since 2015.