TIRANA, April 15 – Both businesses and households became more pessimistic in the first quarter of this year when the country faced massive floods and exports suffered a blow on declining global fuel prices, a survey conducted by the country’s central bank has found.
After recovering for four consecutive quarters, Albania’s Economic Sentiment Indicator, measuring both business and consumer confidence, dropped by 4.6 percentage points in the first quarter of this year, but remained 0.5 percent above its long-term historical average.
“The decline was affected by a confidence drop in all sectors of the economy, including industry, construction, services, trade, and deteriorating consumer confidence,” the Bank of Albania said.
Confidence in the industry sector dropped for the second quarter in a row affected by lower production and deteriorating financial situation.
Expectations for the second quarter of 2015 in industry are more optimistic fuelled by an increase in new orders and exports.
The survey says industry businesses increased investments in the past six months, mainly in purchase of new equipment, but their capacity utilization rate in the first quarter of the year, dropped to 67.7 percent, around 4 percent below their historical average.
The long-ailing construction sector saw its confidence drop by 5.2 percent in early 2015 affected by poorer demand and production. Construction entrepreneurs reported a decrease in demand and rise in their stock of unsold apartments.
Confidence in the services sector also registered a 2.4 percent decrease affected by deterioration in their financial situation and lower investments.
Trade businesses also reported a 4 percent decline on lower demand.
Consumers also increased their pessimism about the country’s economy for the second quarter in a row on deteriorated big purchases and increased cost of living.
