ifo Business Climate Index Rises a Little (November 2019)
Sentiment among German executives has improved a little. The ifo Business Climate Index rose from 94.7 points in October to 95.0 points in November. Companies’ assessment of the current situation was slightly better. Their expectations were also less pessimistic than in October. The German economy is showing resilience. The ifo Institute is expecting GDP growth of 0.2 percent in the fourth quarter.
Manufacturing, however, is still stuck in recession. The index fell back in November following a rise in October. This was the result of a noticeably poorer assessment of the current situation. In contrast, expectations brightened somewhat. Companies still find their current order backlog very disappointing. They are planning further production cutbacks.
In the service sector, the business climate has improved. Service providers were more satisfied with their current situation. After four months, their expectations have also departed negative territory.
In trade, the index has increased strongly. Traders were more satisfied with the current situation. The expectation index also rose markedly. The signs are that business will be very good this Christmas.
In construction, the Business Climate Indicator has fallen somewhat. Companies were less satisfied with their current situation. Their expectations are also more muted.
Prof. Dr. Dr. h.c. Clemens Fuest
President of the ifo Institute
