ifo Business Climate Index Falls
The mood among company managers has weakened further. The ifo Business Climate Index fell from 99.2 points in April to 97.9 points in May. This was due to a considerably worse assessment of the current business situation. The outlook for the coming months, however, was unchanged. The German economy is still lacking in momentum.
In manufacturing, the business climate index fell slightly. Once more, companies rated their current situation less favorably. However, their expectations rose for the first time since September 2018. One bright spot this month was the chemical industry, where optimism has taken the place of recent pessimism.
In the services, the business climate took a substantial hit. Not since April 2013 has the indicator of current sentiment fallen as far as it did this month. Optimism with regard to the coming months also declined.
In trade, the business climate worsened. This fall was due to developments in wholesale. In contrast, retailers were noticeably more satisfied with their current situation. They also adjusted their business expectations for the coming months upwards.
In construction, the business climate index rose for the third time in succession. Companies’ already very positive assessments of the current business situation improved further. Gentle optimism also returned to their business expectations. The construction boom continues.
Prof. Dr. Dr. h.c. Clemens Fuest
President
