1. Brunei Darussalam Central Bank (BDCB) today published Brunei Darussalam's Business Sentiment Index (BSI) for August 2024. The index is based on surveys conducted on more than 500 micro, small, medium, and large businesses from 11 economic sectors in Brunei Darussalam, across all districts.

2. The monthly index is designed to measure the level of business confidence/sentiment in the country covering various aspects including current and future business conditions, investment, employment of workers, as well as costs of running the businesses. Therefore, the BSI serves as a leading macroeconomic indicator with its forward-looking element in the country.            

3. The BSI and sub-indices can be interpreted as below:

4. In August 2024, the main headline index, the Current Business Conditions sub-index, was at 50.2, indicating that, in general, businesses expected improved business conditions in August 2024 compared to July 2024. While mixed views were recorded across sectors, businesses expressed optimism, with higher demand for their goods and services and new projects in August 2024, while some businesses cited concerns of weak performance as consumers may travel abroad during the second school term holiday period. The index for one month (1M) ahead was 50.3, indicating an optimistic outlook as businesses expect to see an increase in production, market activities, and upcoming new projects in September 2024.

5. The Investment sub-index stood at 50.1 for August 2024, 50.1 for one month (1M) ahead, and 50.3 for three months (3M) ahead. Following the sentiments in previous months, businesses expect to increase their level of investment in the current month and continue to do so in the next few months. These include restocking inventories, IT infrastructure improvement, construction of new facilities, relocation and renovation works, opening of new branches, and project-related purchases such as materials, equipment, and machinery.

6. The Employment sub-index was 50.3 for the current month and 50.2 for 1M ahead. Continuing the trend from previous months, and in addition to replacing employees who have resigned, businesses maintained the need to hire employees both on a full- and part-time basis to meet their operational needs and support their expansion plans and projects.

7. The Costs sub-index for the current month and 1M ahead were both recorded at 50.3. In August 2024, businesses generally reported higher operational costs due to the expected increase in business activity and rising salary expenses from workforce expansion. For September 2024, many businesses expected higher running costs due to several factors, including repairs and maintenance, hiring additional employees to support opening new branches, upcoming new projects, and business expansion plans. Businesses also cited higher shipping costs and the need to replenish inventory in response to expected higher demand in the coming months.

Note: 1M – one month, 3M – three months

8. In terms of economic sectors, four out of 11 sectors expected optimistic business conditions in August 2024. The Transport & Communication sector showed the highest optimism with an index of 50.7 as businesses welcomed increased demand for services during the school holiday period. Similarly, the Health & Education sector expected improved conditions compared to July 2024. The Construction sector attributed their optimism to new projects initiated in August 2024, while the Oil and Gas Related sector highlighted improved productivity. On the other hand, five sectors reported pessimism for August 2024, primarily due to the school holiday season, with the Hotels & Restaurants sector indicating the highest pessimism. Additionally, the Wholesale & Retail Trade and Finance & Insurance sectors also shared concerns about subdued market conditions, while both the Manufacturing, and Agriculture, Forestry, Fisheries & Livestock sectors cited adverse weather for their lowered expectations. Meanwhile, the Other Private Services and Real Estate & Ownership of Dwellings sectors expected similar business conditions to July 2024. 

9. In terms of business size, micro- and large-sized businesses reported expectations of better business conditions in August 2024 compared to the previous month. Generally, these businesses attributed the better performance to an expected rise in business activities in August 2024, whilst small- and medium-sized businesses expected business conditions to remain unchanged from the previous month. 

10. The time-series charts for the BSI and its sub-indices since August 2020 can be found in ANNEX 1. For more information on the BSI, members of the public can refer to the technical notes on the methodology and statistics on the BDCB website at www.bdcb.gov.bn and follow updates on the BSI through future press releases and BDCB’s Instagram account @centralbank.brunei.

Business Sentiment Index (BSI) for Brunei Darussalam for August 2024

Business Sentiment Index (BSI) for Brunei Darussalam for August 2024 (MY)

Business Sentiment Index (BSI) for Brunei Darussalam for August 2024 (Others)