Situation of SMEs improves but remains unfavourable

The diffusion index (DI) on business receipts amongst SMEs rose to 45.4 in August.

The diffusion index (DI) on business receipts amongst small and medium enterprises (SMEs) rose to 45.4 in August from 43.4 in July, indicating an improvement in the situation of businesses.

The reading, however, remains below 50 or the contractionary zone, meaning that the business condition of SMEs remains unfavourable.

The increase in the DIs of all sectors, except real estate, drove improvement in the index, said the Census and Statistics Department (C&SD).

Next month, C&SD expects the business condition of SMEs to improve further, with the outlook DI at 48.0.

Meanwhile, DI on new orders for the import and export trades also in August to 46.9 from 43.1 in July. 

According to a government spokesman, the Phase II of the Consumption Voucher Scheme should “continue to support consumption-related businesses, though tightened financial conditions and development of the local epidemic may affect sentiment in these sectors.”