Due to the strong headwinds that India Inc., faces from slowing global growth, monetary policy spillovers, high inflationary pressures, a depreciating rupee and the rise in interest rates, the optimism level of businesses deteriorated to a five-quarter low in Q3 2022, reported Dun & Bradstreet on Thursday.
According to Arun Singh, Global Chief Economist, Dun & Bradstreet, challenges to businesses are intensifying and at the time when businesses face margin pressure both from rising input and borrowing costs, the imposition of taxes on goods and services, especially on export goods, is likely to impact corporate earnings and might have added to the weak sentiment.
Five out of six optimism indices have registered a decline in Q3 of calendar 2022, compared to Q2 2022, resulting in the country’s Business Optimism Index reducing to 69.9, a fall of 27.6%, as per Dun & Bradstreet India Index.
“Our survey shows that the optimism level of businesses for net profits and new orders, which indicate demand for goods and services, is at its lowest in eight quarters. We expect business sentiment to remain bearish as demand turns tepid and risks remain elevated,’‘ Mr. Singh added.
