Confidence in the services sector rises slightly.
The Pernambuco Services Confidence Index (ICS-PE) fell 8,9% in May compared to the same month in 2012, dropping from 133,4 points to 121,5 points on a scale of 0 to 200; despite registering lower levels than last year, the result indicates a relative improvement compared to April.
PE247 - The Pernambuco Services Confidence Index (ICS-PE) fell 8,9% in May compared to the same month in 2012, dropping from 133,4 points to 121,5 points on a scale of 0 to 200. Despite registering lower levels than last year, the result indicates a relative improvement compared to April, when the year-on-year monthly variation was -12,7%. Nationally, sector confidence also showed improvement in the year-on-year comparison, falling from -5,6% in April to -4,5% in May. The data was released by the Condepe/Fidem Agency, in partnership with the Getúlio Vargas Foundation (FGV).
According to Rodolfo Guimarães, Director of Socioeconomic Studies and Research at the Condepe/Fidem Agency, the ICS-PE (Pernambuco Business Confidence Index) points to a recovery in business confidence. “The current situation indicates a turning point, with signs of improvement in the level of activity in the Services sector in Pernambuco during this period. Of the five segments surveyed (Services Provided to Families, Information Services, Services Provided to Businesses, Transportation Services, and Others), two already show favorable evolution, with confidence indices higher than those of the same period in 2012,” he stated.
According to the survey, the Current Situation Index (ISA-S/PE) registered a 9,4% drop in May of this year when compared to the same period last year, falling from 112,8 to 100,3. The indicator that measures the sector's expectations for the following months (IE-S/PE) fell -8,6% in May, going from 156,6 to 143,1. Despite the declines, both the ISA and the IE showed improvements, since, in the April 2013/2012 comparison, both had fallen 11,1% and 13,9%, respectively.
The Current Demand Volume, a component of the ISA, also improved, going from -13,0% in April to -10,1% in May. The proportion of companies that assessed demand as strong was 14,1% (compared to 19,6% in the previous year) and as weak 18,4% (13,2% in 2012).
Another component of the ISA, the Current Business Situation, also showed relative improvement, going from -9,4% in April to -8,8% in May, with 20,6% of companies rating the business situation as good (compared to 37,1%) and 16,5% considering it bad (compared to 22,9%). Both components are part of the ISA-PE.
Regarding the components of the IE-PE (Industrial Expectations Index of Pernambuco), which declined in April, it showed improvement in May, which, according to Condepe/Fidem, indicates a recovery trajectory signaled at the beginning of the year. In the year-on-year comparison, the Expected Demand indicator decreased from -13,0% to -5,2%. The proportion of companies expecting higher demand was 49,4% compared to 58,2% last year, and those expecting lower demand was 5,7% compared to 6,6% in 2012.
In terms of Business Trends, there was also an improvement, going from -14,9% in April to -11,8% in May. The proportion of companies projecting a better situation was 45,6% (compared to 63,8% in 2012), and those expecting a worsening situation registered 3,1%, compared to 2,3% last year.