Issue 54 (October – December 2019)

Author(s): ECES Economists
Publication Number: ECES-BB54

According to this issue of the Business Barometer, firms’ performance in the second quarter of FY2019/2020 (October-December 2019) slightly improved compared to the preceding quarter, recording 52 points (two points above the neutral level of 50 pts). However, these results should be read with caution for two reasons: firstly, according to the survey results, firms refrained from adding new production lines and introducing new products/ technologies for entailing higher risk and huge investments. Hence, improved performance in this quarter was driven by increased domestic sales and exports, raising the levels of production and capacity utilization. However, final product inventories remained at a considerably higher level compared to the previous quarter, which is a point of concern. Secondly, disaggregating the Business Barometer Index (BBI) by firm size indicate declined SMEs performance for the third consecutive quarter.