JSF’s June investor confidence index sees slight drop

AMMAN — Jordan Strategy Forum’s Jordan Investor Confidence Index for June 2019 was measured at 111.3 points, a slight decrease in comparison to May 2019, at 111.6 points.

The index aims to measure the confidence of investors operating in the Jordanian market by three aspects: Confidence in the Jordanian dinar and the monetary system, in the real economy and in the financial system, according to a JSF report.

It measures the impact of policy and exogenous developments on investor confidence, the report continued. It also aims to facilitate a better understanding of investors’ challenges and “promote a strong decision-making process”, whether in policymaking by the public sector or investing decisions by the private sector. 

For the sub-indices, a value of 100 entails the minimum level of confidence while a value of 200 entails the maximum level of confidence compared to previous months since 2015. 

The production of this index complements JSF’s “consistent effort to promote higher levels of investment in Jordan, and a more competitive business environment that can facilitate higher quality of life for all Jordanians”, read the report.

The monetary sub-index decreased by 2.07 points to 133.9 points in June 2019, recording the highest value among all three sub-indices, despite the increase in the Central Bank of Jordan’s (CBJ) gross foreign reserves by JD259 million to reach JD11.5 billion for this month, the report stated.

Additionally, the interest rate differential between the Jordanian dinar and the US dollar increased from 2.36 per cent to 2.37 per cent since May 2019. 

As for returned cheques, the value witnessed a JD12.6 million increase from the previous month to reach JD135.2 million in June 2019, according to the report.

The real economy sub-index observed a decrease of 4.53 points to reach 100.0 points, its lowest value since 2015. The capital of companies registered witnessed a decrease from JD17.6 million to JD8.5 million in June 2019, and the number of companies registered in June 2019 was at 311 companies, down from 366 registered companies in May 2019.

The manufacturing quantity production index decreased by 0.5 points for a recorded 88.4 points. In addition, the number of construction permits decreased to 1,289 permits in June 2019 compared to 1,321 permits in May 2019 and tax revenues on the monthly real estate volume decreased by 0.1 to reach JD5.1 million in June 2019.

Confidence in the financial sub-index saw a significant increase by 10.01 points to reach 111.3 points in June 2019, as the Amman Stock Exchange (ASE) weighted index increased by 139.86 points to reach 3,640.7 points in June 2019. The ratio of inflows to outflows of foreign investment in the ASE increased to reach 102 per cent in June 2019, according to the report.