Companies Survey, 3rd quarter, 2002

17/10/2002
All Press Releases In Subject:
The Economy and Economic Activity

Companies Survey, 3rd quarter, 2002

Overview:

Reports from companies for the third quarter of 2002 indicate that the decline in activity in all the principal industries continued. This accompanied a fall in sales, both domestic and export, and the picture relating to orders also remained gloomy. On the other hand, the rate of decline in the output of all the industries apart from manufacturing and business services was less severe. The decline affected all the main aspects of activity: in manufacturing, output continued to fall, while the downward trend in domestic and export sales continued; in the hotel industry, bed-nights, particularly of foreign tourists, fell; in construction, the downward trends continued, especially in the construction of buildings; in the two-digit transport and communications industries developments varied; sales of business services went down. In reports on the severity of constraints on implementing planned activity, the demand side featured prominently, with manufacturing and the hotels industries reporting on an intensification of the constraint. The main supply-side constraint was financing difficulties in all industries except for construction, in which the shortage of skilled labor headed the list. Average inflation expectations for the next twelve months dropped in the quarter to 4.8 percent. The share of companies expecting inflation to exceed the upper limit of the target inflation range fell heavily to 49 percent, and 29 percent expected inflation to be below the lower limit of the target range. On average, companies expected the exchange rate twelve months hence to be NIS 5.0 to the dollar.

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