Business optimism dips; consumers less gloomy

BUSINESS optimism fell in the third quarter while consumer sentiment became slightly less negative, the Bangko Sentral ng Pilipinas (BSP) reported on Friday.

At 35.8, the confidence index (CI) for businesses declined from 40.8 previously while that for consumers improved slightly to -9.6 percent from -10.5 percent, results of the BSP's latest business and consumer expectations surveys showed.

A positive result means that optimists outnumbered pessimists. The reverse applies with regard to negative CIs.

The reduced business confidence for the current quarter, the BSP said, stems from a drop in sales and demand for goods and services due to weather-related disruptions and other seasonal factors, higher prices of raw materials and production costs, elevated inflation and interest rates, and a weaker peso.

As for consumers, the reduced pessimism was attributed to the availability of more jobs and permanent work; higher income from wages, remittances and other sources; and more family members having found employment.

For the next three months and the year ahead, meanwhile, the CIs for business rose to 53.8 and 59.7, from 46.4 and 58.5, respectively.

The more bullish outlook for the fourth quarter was said to stem from expectations of increased demand for products and services, and higher revenues, better economic conditions amid the lifting of the state of public health emergency, expansion and business opportunities, and new customers and projects.

For the next 12 months, meanwhile, respondents also tagged demand for goods and services across all sectors, an improved business climate, further expansion and new business opportunities, additional clients and projects, and lower inflation as reasons for the higher optimism.

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