ifo Media Center
The ifo Institute invites you to participate in the discussion of interesting economic topics via the Internet. In our ifo Media Center a whole series of remarkable events are available and can be viewed in full length. We also record selected speeches and presentations given by employees or at events and make them available in our Media Center.
Euro 2024: Foreign Tourists Will Add 0.1% Economic Output in Germany in the Second Quarter
The Euro 2024 is expected to bring Germany an additional billion euros from foreign football tourists. That corresponds to around 0.1% of economic output in the second quarter of the year, according to the latest ifo economic forecast, which will be published next week. “However, the effect will only be short-lived, meaning that service exports due to tourists returning home after the end of the Euro 2024 are likely to fall again in the third quarter and, on balance, remain the same,” says ifo researcher Gerome Wolf.
ifo Dresden: Employment Growth in Germany Primarily Through Existing Companies
Existing companies were drivers of employment growth in Germany from 2000 to 2016, according to calculations by ifo Dresden. Start-ups, on the other hand, only played a minor role in employment growth. “Providing government support for the expansion of existing companies is therefore the better way to create more jobs,” as ifo researcher Niels Gillmann explains. “Although promoting start-ups makes sense, it tends to create innovations rather than jobs.”
Increase in Short-Time Work Halted in German Manufacturing
German manufacturing companies responded to the economic slowdown in winter with significantly more short-time work. Although it is likely to remain high in the coming months, it is not expected to worsen any further. In the second quarter, 18.8% of manufacturing companies responded that they were planning to introduce short-time work in the next three months.
Clemens Fuest, président de l’Institut ifo : Le succès électoral de l’extrême-droite peut saper l’action commune de l’UE
Selon le président de l’ifo, Clemens Fuest, les succès électoraux de l’extrême-droite dans l’UE peuvent saper l’action commune en matière de défense, de politique migratoire ou de politique commerciale. « En la matière, l’Europe ne peut réussir que s’il y a une volonté de mettre de temps en temps les intérêts nationaux de côté et de coopérer. Ceci dit, l’UE n’a eu jusqu’à présent que des succès très limités dans ces domaines », a-t-il déclaré mardi à Dresde. Au sein de la zone euro, les conflits liés à la politique d’endettement pourraient s’intensifier, l’endettement très élevé de la France et de l’Italie étant source de conflits potentiels. La réaction des marchés des capitaux – augmentation des écarts de taux d’intérêt entre l’Allemagne d’une part et la France et l’Italie d’autre part – montre que les investisseurs perçoivent ce risque.
ifo President Fuest: Far-right electoral success can undermine joint action in the EU
According to ifo President Clemens Fuest, far-right electoral successes in the EU can undermine joint action on defense, migration policy, and trade policy. “Europe can only be successful here if there is a willingness to occasionally put national interests aside and cooperate. To be fair, however, it has to be said that the EU has only had very limited successes in this field so far,” he said in Dresden on Tuesday. Conflicts over debt policy could intensify within the eurozone. He said that the very high level of debt in France and Italy harbored potential for conflict, and that the reaction on the capital markets today – an increase in interest rate differentials between Germany on the one hand and France and Italy on the other – showed that investors saw this risk.
Conversion of tax allowances to credits - effects on tax relief and employment in Germany
If the basic tax-free allowance in income tax in Germany were completely converted to a tax credit, the lower income groups would benefit more from it, but employment would fall. This is the result of a model calculation carried out by the ifo Institute on behalf of the Center for New Social Policy (ZSP) in Berlin. “Tax-free allowances reduce the income that has to be taxed for everyone. As a result, the absolute tax benefits are particularly high in higher income groups, because the marginal tax rates are higher there. The credits, on the other hand, are direct deductions from the tax payment and could also be extended to lower groups that have not yet benefited from tax allowances, because they do not pay income tax. However, the employment effects would be strongly negative,” says Andreas Peichl, Director of the ifo Center for Macroeconomics and Surveys.
Institut ifo : les Coupes du monde et les Championnats d’Europe de football n’améliorent à peine le moral des entrepreneurs allemands
Le moral des entrepreneurs allemands s’est à peine amélioré lors des Coupes du monde et des Championnats d’Europe de football. « Lors de la Coupe du monde 2006 en Allemagne, les enquêtes conjoncturelles de l’institut ifo ont d’abord montré un certain optimisme. Au cours des 6 mois précédents, la proba-bilité de “meilleures affaires” dans les mois à venir a augmenté de 1,1 % », ex-plique Klaus Wohlrabe, responsable des enquêtes de l’institut ifo « Après la Coupe du monde, les entreprises ont effectivement estimé que leur situation s’était un peu améliorée, la probabilité qu’elle soit “bonne” ayant augmenté de 1,1 %. Mais pendant et après la Coupe du monde, il n’y a plus eu aucun effet sur les attentes », ajoute-t-il. « Nous pensons qu’il en sera de même pour l’Euro. »
Football World Cups and European Championships Barely Improved Sentiment in the German Economy
Sentiment in the German economy has barely improved during World Cups and European Championships. “At the time of the 2006 World Cup in Germany, there was initially a sense of anticipation in the ifo economic surveys. In the 6 months before the World Cup, the probability of ‘better business’ in the coming months rose by 1.1%,” says Klaus Wohlrabe, Head of Surveys at ifo. “After the World Cup, German companies actually found their business situation slightly better, with the probability of ‘good’ increasing by 1.1%. During and after the World Cup, however, there were no more effects on expectations,” he adds. “We suspect something similar now for the European Championship.”
ifo President Fuest: ECB Interest Rate Cut is Good – Further Cuts Could Be a Long Time Coming
ifo President Clemens Fuest welcomes the interest rate cut by the European Central Bank (ECB). “The move makes sense, because inflation in Europe is now heading back toward the target of two percent,” he said in Munich on Thursday. “However, this interest rate cut has already been priced in on the markets, so the stimulus for the economy will be limited. In view of significant rises in wages and postponed interest rate cuts in the US, it is rather doubtful that further interest rate cuts will follow soon.”
German Chemical Industry Confident Again for the First Time
The business climate in the chemical industry in Germany recovered in May and returned to positive territory again for the first time since March 2022. Its index rose to +5.8 points from -5.2* points in April. “Confidence is returning to the German chemical industry,” says industry expert Anna Wolf from the ifo Institute.
Business Climate of the Self-Employed in Germany has improved
The business climate for the solo self-employed and microenterprises in Germany improved in May. The “Jimdo-ifo Business Climate Index for the Self-Employed” rose to -11.8 points*, up from -13.8 points* in April. Business fared better, with only a few self-employed expressing dissatisfaction with their current situation. Expectations also brightened up somewhat, although they were still marked by skepticism. “The self-employed are increasingly hoping that the worst of the economic downturn is behind them,” says ifo expert Katrin Demmelhuber.
Institut ifo : le climat se refroidit dans l’industrie automobile allemande
Dans le secteur automobile allemande, le climat des affaires s’est dégradé au mois de mai. L’indicateur est passé de -2,4* en avril à -8,6 points. C’est ce que révèlent les enquêtes conjoncturelles réalisées par l’Institut ifo. « Dans le cadre du conflit commercial sur les voitures électriques avec les États-Unis ou l’Europe, une réplique de la Chine pourrait avoir un impact sensible sur l’activité des constructeurs automobiles allemands », explique Oliver Falck, directeur du Centre ifo pour l’économie industrielle et les nouvelles technologies.
Sentiment in the German Automotive Cooling Down
The business climate in Germany’s automotive industry deteriorated in May. This indicator dropped to -8.6 points, down from -2.4 points* in April. “Backlash from China to the trade conflict over electric cars with the US and Europe could severely impact business for German automotive manufacturers,” says Oliver Falck, Director of the ifo Center for Industrial Organization and New Technologies.
Business Climate in German Retail Improves Slightly
The ifo Business Climate in Germany’s retail improved a little in May, finds the latest ifo Institute survey. The index rose to -13.3 points, up from -14.5 points in April. While this reflects slightly better business expectations, the outlook for retailers remains pessimistic. The indicator for assessments of the current business situation remained unchanged at -2.1 points. “The European Football Championship is unlikely to deliver any noticeable sales impetus for retail as a whole,” says ifo expert Patrick Höppner.
ifo Price Expectations Rise Slightly
The ifo price expectations rose a little to 16.2 points in May, up from 15.2 points* in April. In manufacturing and wholesale in particular, slightly more companies plan to raise their prices than in the previous month. In consumer-related industries, by contrast, price expectations declined. “This means inflation is likely to fall again in the coming months. In August, it should drop below 2 percent for the first time since March 2021,” says Timo Wollmershäuser, Head of Forecasts at ifo.
ifo Business Climate Eastern Germany Rises Further (May 2024)
The ifo Business Climate Index for Eastern Germany rose slightly in May. The barometer of business sentiment for the regional economy in eastern Germany climbed to 92.8 points, up from 92.2 points in April. The eastern German companies surveyed provided assessments of their business situation that were somewhat better than the previous month, and they raised their business expectations slightly. The upward trend continues.
ifo Employment Barometer Rises (May 2024)
The willingness among companies in Germany to hire new staff has increased slightly. The ifo Employment Barometer rose to 96.3 points in May, up from 96.0 points in April. “Demand for workers remains rather weak,” says Klaus Wohlrabe, Head of Surveys at ifo. “Those companies that are experiencing a lack of orders are also thinking about cutting jobs.”
ifo Researcher Potrafke Critical of Germany’s Pension Package
ifo researcher Niklas Potrafke has criticized the pension package recently adopted by the German government. “Freezing the pension level at 48 percent and suspending the sustainability factor completely ignores the realities in Germany. Demographic change demands a different pension policy. The introduction of the sustainability factor 20 years ago marked a cautious start to taking account of demographic trends in the pension system. In Germany, fewer and fewer young people have to look after an increasing number of older people. With the population structure developing in this way, pensions will have to rise much more slowly,” Potrafke said in Munich on Wednesday.
Institut ifo : hausse des prévisions en matière d’exportations
Le moral des exportateurs allemands s’est amélioré. Les prévisions communiquées à l’Institut ifo en matière d’exportations ont progressé, passant de – 1,5 point en avril à + 0,3 point en mai. « Les réponses positives et négatives s’équilibrent presque parfaitement », indique Klaus Wohlrabe, directeur des enquêtes de l’Institut ifo. « Dans l’ensemble, la dynamique des exportations reste cependant poussive. »
Export Expectations Rise (May 2024)
Sentiment in the German export industry has turned brighter. The ifo Export Expectations rose from -1.5 in April to +0.3 points in May. “Positive and negative responses are in nearly perfect balance,” says Klaus Wohlrabe, Head of Surveys at ifo. “The export economy is not yet developing any great momentum overall.”
