Biz confidence falls to eight-month low

Thursday, 6 November 2014 00:00 - - {{hitsCtrl.values.hits}}

The forthcoming edition of business magazine LMD reveals that “the unique index that charts corporate sentiment has dipped for the third consecutive month, reflecting concerns over consumer spending and the growing influence of politics on business”. It says that the LMD-Nielsen Business Confidence Index (BCI) fell by four basis points to 128 in October, which means that “the index has shed a notable 11 points in the last three months”. Nielsen’s Managing Director Shaheen Cader explains: “Despite increasing optimism about the economy, the BCI has continued its gradual decline, as seen in recent months – mainly as a result of concerns about consumers’ spending power being restricted due to the high cost of goods and services.” Cader also states: “Another factor which seems to have a bearing is the increasing concern of political activities impacting business, which has been an apprehension in the past as well, when elections occur.”

However, LMD notes that “businesspeople appear marginally more optimistic about the economy in general, with four-in-10 respondents (up from 37%, in September) stating that economic conditions will improve in the 12 months ahead.” Speaking exclusively to the Daily FT, a spokesman for LMD says that “corporates also have a more positive view on the investment climate in the country. In fact, nearly 45% of Nielsen’s survey sample is encouraged by the investment outlook, whereas this figure was around 33% in September.” The magazine concludes that two key events will influence business confidence in the next two months – namely, how the business community views the recent Budget proposals; and whether or not there will be elections early in the New Year. LMD’s publisher, Media Services, says that the magazine will be released to bookstores and supermarkets on Friday 7 November.