Finans

IFO: Tysk erhvervstillid på forventninger dykker videre ned

Fra IFO.de

In manufacturing, the business climate index fell once again. While the indicator of the current situation is still above its long-term average, it has now been falling for over a year. As to business expectations, last month’s ray of light has disappeared. Industrial companies’ pessimism grew, due primarily to shrinking order books.

In the services, the business climate worsened, driven by noticeably less optimistic expectations. In contrast, service providers were more positive in their assessment of the current business situation.

In trade, the index rose. Companies were more satisfied with their current situation. They were also more confident about the coming months. For wholesalers, the improvement was stronger in the index of expectations; for retailers, it was the indicator of the current business situation that rose more.

In construction, the business climate index fell, but remains at a high level. Companies’ assessment of their current situation worsened. Their business expectations for the coming six months also fell.

Clemens Fuest
President of the ifo Institute

Monthly movements of the ifo Business Climate Index Germany can be transformed with the help of Markov Switching Models into probability statements for the two cyclical regimes expansion or contraction. The ifo Business Cycle Traffic Lights provides the monthly regime probabilities for the expansion phase. The probabilities signal an economic expansion (green lights) insofar as they exceed the 66% mark; contractions insofar as they are under the 33% mark (red lights); or indifference (yellow lights) when in the range in between. This indifference interval can be interpreted as a buffer zone between the regimes expansion and contraction, in which particularly great uncertainty exists about the state of the economy.

ifo Business Climate Germany

(Index, 2015 = 100, seasonally adjusted)

	06/18	07/18	08/18	09/18	10/18	11/18	12/18	01/19	02/19	03/19	04/19	05/19	06/19
Climate	102.1	102.2	104.2	103.9	102.9	102.3	101.2	99.6	98.8	99.7	99.3	97.9	97.4
Situation	105.4	106.4	107.4	107.4	106.4	106.2	105.4	104.7	103.9	104.1	103.5	100.7	100.8
Expectations	98.9	98.2	101.0	100.5	99.4	98.6	97.2	94.8	94.0	95.6	95.3	95.2	94.2

Source: ifo Business Survey.
© ifo Institute

ifo Business Climate Germany and by Sector

(Balances, seasonally adjusted)

	06/18	07/18	08/18	09/18	10/18	11/18	12/18	01/19	02/19	03/19	04/19	05/19	06/19
Germany	23.2	23.5	27.7	27.2	24.9	23.8	21.3	17.8	16.0	18.0	17.1	14.1	13.0
Manufacturing	24.2	23.0	24.3	23.7	18.9	18.0	15.0	11.4	9.2	6.7	4.1	3.9	1.5
Service Sector	26.3	28.1	33.3	33.6	31.9	31.6	27.6	25.0	21.7	26.4	26.5	21.0	20.0
Trade	10.9	10.8	10.9	11.9	10.8	10.1	9.5	4.7	4.6	8.3	7.2	5.4	7.9
Construction	20.1	27.7	29.5	31.7	32.1	28.9	28.6	19.9	18.1	21.5	21.8	24.3	22.9