The confidence index for economic activity continues to decline

Written by Lionel Ibarra – Strategyandbusiness.net

The confidence index for Guatemala’s economic activity stabilized at 50.53 points last July, down by 6.43% compared to the index recorded in June 2022 (54.00 points) and lower by 28.18% compared to recorded in July 2021 (70.36 points).

These are part of the results of the Survey of Economic Outlook for the Private Analysts Team (EEE) prepared by the Committee of Private Analysts (in consultation with the Bank of Guatemala), which aims to measure the perception of the current economic situation and business environment in the country.

According to the responses of the Committee of Special Analysts, 57.8% of those interviewed considered the business climate for the upcoming semester It will remain the same during the previous semester; 21.1% of those interviewed consider that this climate will improve, and; 21.1% that the situation will get worse.

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It should be noted that with regard to the year to date, the result of last July Represents a setback from expectations that prevailed during the period from March to June of this year or in relation to sentiments that prevailed exactly one year ago, when 80% of respondents stated that they expected an improvement in the business climate in the subsequent six months.

Likewise, he seeks an estimate of the economic development of the country in the near future.

The team expects swell rhythm In July 2022 it will be 7.32% while it will be 7.15% and 6.94% for August and September of this year. For December 2022 and 2023, the committee expects an inflation rate of 6.04% and 4.80%, in that order.

In addition, for the 12- and 24-month horizon (July 2023 and July 2024), the Committee forecasts an inflation rate of 4.88% and 4.51%, respectively. And when comparing the results mentioned with those obtained in the month above, it was noted that the expectation of the inflationary rhythm for the end of 2022 by 0.54 percentage point (5.5% in the previous survey) and in December 2023 it grew 0.28 percentage points (4.52% in the previous survey).

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team sees, The main factors that can explain inflation expectations December 2022 are: the behavior of fuel prices, the path of world oil prices, the prices of raw materials, the performance of fiscal policy, the performance of monetary policy, the seasonality of agricultural products and weather conditions.