|Mfg. Conf. Level||104.2||104.1||104.6||104.4|
|Cons. Conf. Level||117.0||117.6||118.4|
|Bus. Conf. Level||105.8||107.1|
According to the new Istat survey overall business sentiment deteriorated slightly this month. At 105.8 the composite indicator was 1.3 points short of its unrevised November print and at its lowest level since August. That said, it was well above the readings seen earlier in the year and more than 12 points higher than its mark at the end of 2014.
At a sector level, morale in manufacturing was just 0.3 points weaker at 104.1, its second successive decline but still its third best outturn over the year as a whole. At 114.3, services actually registered an improvement and a new multi-year high but there were sizeable falls in both construction (114.8 after 121.4) and, particularly worryingly, retail (109.1 after 115.0).
Households were also a little less upbeat this month with their confidence measure losing 0.8 points to 117.6. However, this was still the second highest posting since well before the Great Recession and so should bode well for spending over the next month or so. That said, the buying intentions sub-index dipped a couple of points from November's 2015 high to minus 34. At least inflationary expectations rose quite sharply and, at minus 11, recorded their strongest level since January 2014.
Today's results make for some downside risk to next week's PMI surveys although the apparent improvement in service sector morale suggests that any drop in December's composite output index will be only small.
Istat's business and consumer confidence surveys are conducted over the first fifteen and ten working days of each reference month respectively and provide information about current and expected developments in key sector variables. The largely qualitative results are synthesized for each survey into a single number that provides an overall measure of sentiment. Business confidence reflects the combined results of separate surveys covering manufacturing, retail, construction and services.
If investors want to know how the business or consumer sectors are performing as they evaluate their investment decisions, they can find timely and in depth information in the latest Istat surveys. Although short-term swings can be erratic, changes in trends in confidence can contain very useful information about a sector's underlying health well in advance of the release of the official data. Moreover, by including some forward-looking components (e.g. manufacturing orders or consumer buying intentions) the Istat surveys can also provide a potential insight into prospective developments.