This paper and its associated papers have always made it a point to follow closely the business and consumer surveys that are published each quarter with the Central Bank’s Quarterly Review, both when they were reporting optimism and when they reported pessimism among the business people and consumers.
The surveys that were published in the latest edition of the Quarterly Review have never been so optimistic.
“In the final quarter of 2013, confidence rose in all the surveyed sectors measured by the economic sentiment indicator (ESI).
“Confidence among firms operating in the services sector increased after having declined in the previous quarter. It also rose among consumers, with the indicator turning positive in November for the first time since the survey started.
“Meanwhile, confidence in the manufacturing and construction sectors improved but remained in negative territory.
“As a result of these movements, the ESI which summarises developments in all these sectors, rose to 110.9 in December from 104.1 in September and remained above its long-term average of 100.5.
The survey continues: “Confidence among firms operating in the manufacturing sector remained negative but rose from -8 in September to -2 in December 2013. As a result, the indicator moved above its long-term average of -6.
“Confidence rose mainly as a result of improved production expectations. While in September the majority of respondents expected production to remain broadly unchanged over the subsequent three months, in December the majority anticipated an increase in production.
“On the other hand, a slightly larger number of respondents reported weak order book levels. On balance, respondents in December believed that their stock of finished goods would decrease by a lesser extent compared with September. In December, the production expectations sub-indicator stood above its long-term average, while order books were below their respective long-run average. The accumulation of stocks has recently lost some momentum, suggesting that the weakness in industry may have begun to bottom out around the end of 2013.
“The majority of respondents continued to anticipate their labour complement to increase over the following three months, although overall the number of these participants was lower when compared with September. Meanwhile, the share of participants anticipating a decrease in their selling prices rose marginally compared with September. The majority of respondents indicated insufficient demand as the main factor inhibiting business activity.
”During the quarter being reviewed, confidence among construction firms, while still negative, rose to -35 in December from -42 three months earlier. The indicator, however, remained below its long-term average of -32.
“The rise in confidence was completely spurred by a lower share of respondents expressing an intention to reduce their workforce in the following three months. In contrast, the proportion of firms that considered their current order books to be below normal increased.
“After having declined in the third quarter of 2013, confidence among service providers rose in the final quarter, reaching the level recorded in June 2013. The indicator stood at 21 in December, compared with 13 in September and moved above its long-term average of 19.
“Between September and December confidence improved in the accommodation sector, in financial services and in the food and beverage industry. On the other hand, confidence fell among firms operating in air and land transport, programming and broadcasting and rental and leasing. Confidence remained practically unchanged in the gaming sector.
“During the fourth quarter of 2013, the consumer confidence indicator reported further gains. A particularly strong improvement was recorded in November, when the reading turned positive for the first time. The consumer confidence indicator fell slightly in December ending 2013 at 0 up from -6 in September. At the end of 2013, the indicator thus remained above its long-run average of -26.