BIEC: The Polish Leading Business Index (WWK) rose by 1.7 points in July

by   CIJ News iDesk III
2021-07-27   09:18

The Leading Business Climate Index (WWK) - informing in advance about future trends in the economy - increased by 1.7pts m / m in July this year. to 168.6 points, the Biuro Inwestycji i Cykli Ekonomicznych (BIEC) reported in the report. Domestic demand is strongly recovering, the Bureau emphasized.

The economy is still in the phase of post -andemic recovery. In the period of subsequent lockdowns, the main driving force limiting the collapse of its activity was export, and in particular the production of foreign investor companies with defined recipient markets. At present, we observe a weakening role of this factor. In the case of the processing sector, stock production was not without significance for the recovery of the economy, the report reads.

BIEC points out that in July this year. the pace of the inflow of new orders was reduced compared to June this year. and it mainly concerned export orders.

"Admittedly, we usually observe a slower inflow of orders during the summer holidays, but the data from which the influence of the seasonal factor has been removed also indicate a slight decrease in orders so far. Out of 22 industries, six are currently experiencing a decline in inflows. Of these, the automotive industry is the largest of these. Capital goods manufacturers are also experiencing a decline in order inflow", according to the report.

The surveyed companies in the processing sector have an advantage of those in which the financial condition is deteriorating month by month and "is at a significantly lower level than before the pandemic.

This is due to the rapidly growing production costs. The PPI price index in June exceeded 7.2% (average annual value). It is true that some raw materials on the global markets have stopped growing recently, but in the case of Polish companies it is not the only factor determining prices Industrial goods. Labor costs, energy prices as well as taxes and levies imposed on entrepreneurs are rising just as quickly. Every second entrepreneur lists labor costs and the tax system as the strongest factors hampering running a business, according to the report.

BIEC reported that optimists (entrepreneurs judging that there has been an improvement) prevail among large companies - employing more than 500 employees, while pessimism dominates in small companies.

Source: BIEC and ISBnews