Large firms grew more pessimistic about the performance of the Hungarian economy, with 26% expecting deterioration, the highest number in a year. Businesses were also decidedly downbeat about the prospects of their own companies, with pessimists, at 31% of respondents, outnumbering optimists for the first time since December 2003.
The decline in overall confidence was underpinned by companies' outlook on domestic as well as export sales. Of Top-100 firms, 28% projected shrinking export sales, a significant increase since April, while in domestic sales prospects, the number of those expecting a decline approached record levels at 30%.
In a seeming contradiction, a record 74% of large companies said they planned developments in the coming period, even though less than 10% reported a shortage of manufacturing capacities.
In Ecostat's survey of SMEs, the confidence index was down 5.9 points to 40.0%, the lowest in two years. Just slightly more than 20% of SMEs expected an improvement in their situation or in that of the national economy, falling by almost half since the beginning of the year. Worsening domestic sales prospects and a bleak macroeconomic and fiscal outlook were the main drivers of pessimism among SMEs.
