Belgium: Forward-looking indicators suggest weak growth going forward
May 24, 2012
In May, the National Bank of Belgium's business confidence indicator fell to minus 11.2 points from minus 10.7 points in April, which marked a third consecutive deterioration in the index and represents the lowest level recorded since November 2011. The reading, however, was virtually in line with market expectations, which had anticipated the index would fall to minus 11 points. According to the Bank, the decline in May was mainly driven by a marked deterioration in confidence in the construction sector, due to lower equipment utilisation and drop a in orders received. Faltering business confidence does not bode well for investment going forward. Simultaneously, the Bank's May consumer confidence indicator improved from minus 12 points in April to minus 10 points in May, which represents the highest level since October 2011. The survey revealed that, although consumers expect the overall economic situation will worsen in the next 12 months, they were less concerned about an increase in unemployment.
Author: Ricardo Aceves, Senior Economist