Economic sentiment indicator
03. Jan 2025
Survey in progress: How do households view the Faroese economy and their own financial situation?
Statistics Faroe Islands will be calling 700 randomly selected households in the Faroes over the next three weeks. The households will be asked 16 questions about their personal finances and their outlook on the Faroese economy as a whole.
A quarter struggles to make ends meet
In the last economic sentiment survey from this summer, and in previous surveys, about a quarter of households reported only just being able to make ends meet. About 60% say they are saving money. Despite significant consumer price hikes in the past three years, household borrowing does not appear to have increased. Statistics Faroe Islands is currently looking into these figures for January 2025.
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Other questions and graphs are available on the Economic Sentiment Indicator (ESI) for households page.
Economic tendency surveys for industry
Later this month, economic tendency surveys will be conducted for the primary, service, retail and construction industrial sectors. In these surveys, more than 100 Faroese businesses will be sent a set of questions, with different questions and different multiple-choice answers for each sector. Pursuant to the Law of the Løgting no. 33 of 7 May 1991, businesses are required by law to respond to the questionnaires.
The survey questions are the same as those used in all countries in the ECFIN partnership. The survey methodology is also the same, meaning that the figures are internationally comparable.
ESI – an indicator of economic outlook
The economic tendency survey consists of indicators that measure economic optimism among consumers and businesses. The major element of this survey is the economic sentiment indicator (ESI), a composite indicator compiled twice annually (January and June) that calculates the confidence that consumers and the main four industrial sectors have in the economy.
Rather than reflecting a real economic figure, the ESI represents the difference between the percentages of respondents giving positive and negative replies about their current and projected economic outlook.
Households (consumers) contribute 20% to the overall index. The remaining 80% comes from four key industrial sectors, each weighted according to their economic contribution: primary sector (40%), services (30%), retail (5%) and construction (5%).
Questions and graphs are available on the theme pages for the primary sector, services, construction and retail trade.