Confidence in construction reaches the highest since December 2015, shows FGV

Source: PINIweb

The Construction Confidence Index (ICST), published by the Getúlio Vargas Foundation (FGV), rose 2.1 points in May and reached 69.1 points, the highest since December 2015 (69.4 points). With the result, the quarterly moving average increased by 0.8 point in the margin and interrupted a sequence of 29 consecutive drops since December 2013 this form of assessment.

"In May, the increase in confidence was more robust and widespread in the industry. Buildings, Infrastructure and Specialized Services, in short, in all segments grew the realization that the demand rate of decline should slow down in the short term, fueling business confidence. However, the difficulties of the current economic and political environment suggest that it is a very short time so that, in fact, occur this reversal", noted Ana Maria Castelo, Project Coordinator Construction of FGV/IBRE.

The Expectations Index (IE-CST) increased 5.7 points, reaching 77.9 points. The index is the highest since June 2015 (78.1 points). Among the items in the index, the expectations with the business demand for the next three months was the largest contributor to the high as varied 5.9 points in May.

Already the Current Situation Index (ISA-CST) decreased by 1.5 points and reached a new historic floor of 60.9 points. The largest contributor to this decrease was the satisfaction of businesses with the current business situation, which had a decrease of 3.5 points from the previous month.

Ana Maria Castelo also explains the evolution in opposite directions of the two components of the index. "Businessmen have become less pessimistic about the near future, although activity continues to decline. However, if investment in infrastructure and the housing market will not return to expand, the indicator of expectations should not sustain the improvement in recent months" he concluded.