Belgium: Leading indicators deteriorate sharply in October
October 23, 2012
The business confidence indicator published by the National Bank of Belgium (NBB) fell to minus 13.5 points in October, reaching the lowest level in three years. The reading came in below the minus 11.6 points registered in September and contrasted market expectations, which had the index rising to minus 11.0 points. According to the NBB, business confidence deteriorated across the board, but the decline was particularly driven by falling confidence in the construction and manufacturing sectors. Low levels of business confidence do not bode well for fixed investment going forward. Simultaneously, the Bank's October consumer confidence indicator dropped to minus 17 points, which came in below the minus 14 points recorded in September. The reading represents the lowest level recorded since February. According to the NBB, the deterioration was the result of consumers more pessimistic view of the general economic situation as well as a less optimistic assessment regarding job prospects in the next 12 months. On a positive note, households expected no change in their future financial situation, while they assessed that their capacity to save will increase in the year ahead.
Author: Ricardo Aceves, Senior Economist