A mild deterioration was recorded in November in the business expectations index for the sector Hotels – Restaurants – Travel Agencies, according to the latest Economic Conjuncture Surveys of IOBE. The index fell to 113.4 points from 116.3 in October, continuing the downward trend observed in the main sectors of the economy.
Businesses appear less optimistic about the current situation, with positive assessments decreasing slightly to +46 points (from +48). More significant is the decline in assessments of current demand, which dropped to +36 points from +51.
Despite the overall deterioration, forecasts for short-term demand developments show a small recovery, rising to –31 points compared with –38 the previous month.
In employment, negative forecasts eased slightly, with the index improving from –37 to –30 points.
At the same time, businesses appear to recognize that, due to prevailing conditions (reduced demand, competition, seasonality), they cannot raise prices — on the contrary, they expect they will need to hold or reduce them. This is interpreted as a “strongly deflationary” level of expectations, with IOBE data showing that prices remain in a strongly deflationary environment, at –24 points, indicating continued pressure on profit margins in the tourism sector.
Across the economy as a whole, the Business Expectations Index in Services fell sharply in November to 113.3 points from 123.9 in October. Among the index’s components, positive assessments of the current state of businesses weakened slightly, as did positive assessments of current demand and forecasts for its short-term development.
More specifically, the index of assessments regarding the current state of businesses moved slightly lower than the previous month, to +36 points, with the index of current demand assessments at +35 points from +52 previously.
Forecasts for demand over the next quarter also moved mildly downward to +25 (from +36) points, while employment forecasts moved upward to +25 (from +20) points.
Regarding prices, the corresponding balance stands at strongly inflationary levels, at +24 points. In the question concerning the degree of uncertainty in the economic environment, 40% consider future economic developments difficult or rather difficult to predict, slightly higher than the 38% recorded the previous month.
