ZAGREB, 25 February, 2021 - Expectations for the Croatian economy increased in February to the highest level since March 2020 reflecting the wave of optimism in the services and retail sectors, as business leaders signalled a lower demand for workers, a European Commission report showed on Thursday.
In February, the Economic Sentiment Indicator (ESI) was 94.1 points, or 3.9 points higher than in January, which was its highest level since March 2020 and the outbreak of the coronavirus pandemic. Its value, however, is below the long term average of 100 points.
The greatest improvement was observed in services confidence, increasing by 6.5 points. Retail and industry confidence improved significantly, by 4.8 and 3.3 points respectively, reaching their highest level since March 2020. A mild improvement was registered in construction confidence and in consumer confidence, up 1.7 and 1.6 points month on month.
Business leaders, however, signalled a decline in the need for workers in the coming period, with this index falling to 90.3 points or by 3.4 points m-o-m, which is its lowest level since June last year.
Slight improvement in EU and euro area
Economic sentiment in the EU and the euro area in February registered a mild growth of 1.9 points to 93.1 and 93.4 points respectively, the EC said in its report.
The highest increase in the EU and euro area was in industry confidence, of 2.4 points in the EU and 2.8 points in the euro area.
Services confidence improved by 1.1 points in the EU and by 0.6 points in the euro area.
The slightest improvement was observed in consumer confidence - 0.8 points in the EU and 0.7 points in the euro area while construction confidence remained unchanged compared to January.
Retail confidence deteriorated, with the index falling by 0.5 points in the EU and by 0.6 points in the euro area.
Business leaders expect that they might step up hiring in the coming period so the Employment Expectations Indicator (EEI) increased by 1.7 points in the EU and by 1.8 points in the euro area, the EC report showed.
