Economic Downturn Intensifies

The results of the WIFO-Konjunkturtest (business cycle survey) show a continuation of the decline in business assessments of the economy in August. The WIFO Business Climate Index stood at –8.9 points (seasonally adjusted), 3.6 points below the previous month's value (–5.2 points). Assessments of the current situation declined across all sectors and were deeply in negative territory, especially in manufacturing. Economic expectations also deteriorated further, signalling a pessimistic economic outlook. Demand for credit among companies did not decline further in August, but the majority of them still assess banks' willingness to lend as restrictive.