ifo Business Climate Index Eastern Germany Falls Further (November 2021)
Sentiment among companies in eastern Germany deteriorated noticeably in November. The ifo Business Climate Index for the entire regional economy continued to slide, falling to 97.4 points, down from 98.7 points in October. Participating companies reported a marked decline in their assessments of the current situation. At the same time, their expectations dropped somewhat compared to the previous month.
In eastern German manufacturing, the business climate cooled significantly again in November. The negative trend of recent months continues unabated. Industrial companies rated their current business a little less positively and lowered their expectations drastically for the coming months. Pessimism is spreading in manufacturing.
In the eastern German service sector, sentiment plunged in November. The service providers surveyed lowered their overall assessments of the current situation considerably, while they scaled back their expectations for the coming six months somewhat. Pessimism is spreading in this sector as well.
The ifo Business Climate Index in eastern German trade plummeted in November. While the subindices for retail showed opposing trends, with positive assessments of the current situation and a negative outlook, in wholesale all indices pointed downward.
In eastern German construction, the business climate turned a little brighter in November. The construction companies surveyed assessed their current business as much better than in the previous month, while their outlook for the coming months trended sideways.
Joachim Ragnitz and Marcel Thum
Executive Directors, Dresden Branch of the ifo Institute
