TIRANA, Feb 18conomic Sentiment (ESI) fell to 83.2 (-5.1 percentage points) in the fourth quarter of 2009, after an increase during the two previous quarters. The current ESI level has moved away from its long-term average, standing 16.8 points below it.
A fall of confidence in the construction sector provided the main contribution to the deterioration of the economic sentiment indicator. The confidence drop in the industry and services, and the worsening of consumer confidence, affected also negatively the ESI performance, albeit at a lower rate when compared to the construction sector. During the fourth quarter of the year, the domestic and external demand was assessed negatively and in decline, at the economy level. Orders have decreased in the fourth quarter of 2009. Similarly, capacity utilization has declined again during the same period, recording a rate of 65.6 percent.
The Industry Confidence Indicator (ICI) dropped by 0.6 percentage points during the fourth quarter of 2009, interrupting the positive developments recorded during second and third quarter of year 2009. ICI increased by respectively 2.3 and 5.6 percentage points during these quarters, after a considerable fall of 13 percentage points in the first quarter of this year. Currently, ICI stays at 8.4 percentage points below its long-term average. ICI declined in the fourth quarter of 2009 mainly because of the negative evaluation of the businesses industrial production. Similarly, the rise of inventories contributed negatively on the aggregate ICI for this sector. On the other hand, their assessment of the employment situation, despite providing a positive contribution to the ICI, failed to offset the negative developments of the other two components.
The Construction Confidence indicator (CCI) recorded a drop of 12.8 percentage points during the fourth quarter of 2009, recording the lowest historical value since measurement started on the second quarter of 2002. The deterioration of the aggregated CCI owed to the negative developments present in all its components. The drop of the demand balance by 17.6 percentage points in quarterly terms provided the primary negative contribution. Likewise, the production performance recorded a negative assessment in the fourth quarter of 2009. CCI balance fell by 15.2 percentage points compared to the third quarter of year. The employment situation is also negatively assessed, registering a decrease of 5.2 percentage points with regards to the previous quarter.
Services Confidence Indicator (SCI) fell slightly by 0.2 percentage points in the fourth quarter of 2009, currently staying 3.9 percentage points below its long-term average. The seasonally adjusted improvement of the financial situation balance was not sufficient enough to fully compensate for the drop in the general economic situation and employment balances.
Consumer Confidence Indicator (CCI) was reduced slightly by about 0.5 percentage points in the fourth quarter of 2009. The CCI, albeit in negative territory, is about 1.7 percentage points above its long-term average. CCI’s negative performance was triggered by a combination of different developments of its four defining components. More precisely, the balance of consumer expectations regarding the general economic situation for the first quarter of 2010 provided a negative contribution dropping by about 4.3 percentage points compared to the previous quarter. The expectations’ balance for the financial situation, during the first quarter of 2010 contributed positively on the CCI movement. The balance of savings and of major purchases showed improvements, which, although at negative overall levels, managed a positive growth of respectively 0.6 and 0.3 compared to the previous quarter.
