Nearly a quarter of SMEs see conditions worsening in six months: OCBC

Outlook survey signals reduced optimism amongst smaller firms in the latest reading.

Small- and medium-sized enterprises (SMEs) are turning more cautious on the business outlook, with 22% of respondents expecting conditions to deteriorate over the next six months, up seven percentage points from the previous quarter.

OCBC’s SME Business Outlook poll showed a seven-percentage-point decline in improvement sentiment, whilst sentiment for unchanged business conditions rose by one percentage point.

SMEs identified geopolitical uncertainty as the top near-term constraint, particularly amongst outward-oriented firms.

The report also noted that higher energy prices and freight rates could lengthen delivery times and disrupt supply chains, potentially undermining the competitiveness of SMEs reliant on external markets.