Business confidence continued to rise in August

Finland’s business confidence continued its upward trend in August. Confidence indicators for services and retail trade strengthened significantly. In manufacturing, confidence remained unchanged from the previous month, while confidence in construction eased slightly from July’s peak.

Manufacturing confidence indicator remained broadly unchanged

Confidence in the manufacturing sector remained broadly unchanged in August. The latest confidence indicator reading stood at +6, compared with +7 in the previous month. Confidence thus remained somewhat above its long-term average of 0.

Production expectations for the coming months continued to be positive, with output projected to increase. Order books improved further and rose slightly above their long-term average level. Stocks of finished goods remained at a normal level. However, spare production capacity was still available, as only 64% of companies reported operating at full capacity.

According to comparative data collected in July, confidence among Finnish manufacturing companies remained well above the EU average.

Construction confidence eased slightly from the previous month

Confidence in the construction sector was slightly lower in August than in July, although the indicator remained on an upward trend. In the latest survey, the confidence indicator recorded -9, compared with -5 in the previous month. The latest reading places confidence at its long-term average level.

Construction companies’ assessments of their order books were weaker than in the previous month. Employment expectations, however, improved somewhat, and companies anticipate a slight increase in staffing levels over the coming months.

According to data collected in July, confidence in Finland’s construction sector was in line with the EU average.

Services sector confidence improved

Confidence in the services sector improved significantly in August. The confidence indicator rose to +16, up from the revised +9 recorded in the previous month. Confidence climbed somewhat above its long-term average of +11.

According to service companies, the overall business situation has improved over the summer. Sales have increased at a moderate pace, and businesses expect steady growth to continue in the coming months.

Based on comparative data collected in July, economic confidence among Finnish service companies was slightly stronger than the average across EU countries.

Retail trade confidence on the rise

Confidence in the retail trade sector increased in August. The confidence indicator rose to +17, up from +12 in the previous month. The indicator remains well above its long-term average of −2.

Retail sales grew strongly in August, and expectations for the coming months have also become more positive. Inventories decreased somewhat during the month.

According to the survey conducted in July, confidence among Finnish retailers was clearly higher than the average across EU countries.