As the pandemic worsens, business confidence declines sharply in March | Economy

With the result, the average for the 1st quarter was 6.1 points below the average for the previous quarter.

“With the worsening of the pandemic situation in the country, business confidence suffered a sharp decline in March. In addition to the intensification of the trend of deceleration in the level of activity that was already observed in previous months, there was a significant increase in pessimism in relation to the coming months, affecting the prospects for sales and hiring ”, evaluated Aloisio Campelo Jr., statistics superintendent FGV / Ibre.

The Business Confidence Index (ICE) consolidates the confidence indices of the four sectors covered by the Business Surveys produced by FGV IBRE: Industry, Services, Trade and Construction.

The confidence of all sectors that make up the ICE decreased in March.

“Trade confidence plummeted, falling below Services confidence, which was already very low in February. The gap between Industry confidence, which is falling but still high, and that of other sectors reached a historic record in March,” he said. the researcher.

For the third consecutive time, there was a decrease in both the index that measures the perception of the current situation and the index that reflects expectations in relation to the coming months. The Current Business Situation Index (ISA-E) yielded 4.6 points, to 88.8 points, and the Expectations Index (IE-E) fell 8.6 points, to 83.2 points.

According to FGV, business confidence advanced in only 24% of the 49 segments included in the index in March, a worsening of the spread compared to 37% last month. The industry had 42% of the segments on the rise, while services and construction registered less than 20%. In commerce, no segment has seen a rise in confidence.

“With the worsening of the pandemic it became evident this month that the economic recovery will be slow at best and remembering that in March it was also the month in which the adjustment of the Selic by the BCB started to try to face inflation. Apart from these factors, there is in the a certain apprehension about the political climate that has become more nebulous “, evaluated Necton economist André Perfeito.

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