ifo Business Climate Remains Gloomy (October 2022)
Sentiment in the German economy continues to be grim. The ifo Business Climate Index dipped to 84.3 points in October, following 84.4 points in September. Companies were less satisfied with their current business. Their expectations improved, but they are still worried about the coming months. The German economy is facing a difficult winter.
In manufacturing, the index fell again due to companies’ more pessimistic expectations. In contrast, they assessed their current situation as somewhat better. Order books are still full, although fewer and fewer new orders are coming in. Capacity utilization sank from 85.3 percent to 84.6 percent, but is still above the long-term average of 83.6 percent.
Following the previous month’s nosedive, the business climate in the service sector improved slightly. Service providers were less pessimistic in their view of the coming months, but they assessed their current business as somewhat worse.
In trade, the index rose thanks to slightly better assessments of the current situation. Expectations remain markedly bleak, however, especially in retail.
The index in construction declined once more. Assessments of the current business situation fell to their lowest level since January 2016. Expectations continued to deteriorate and order backlogs decreased.
Clemens Fuest
President ifo Institute
Survey
ifo Business Climate Remains Gloomy (October 2022)
Sentiment in the German economy continues to be grim. The ifo Business Climate Index dipped to 84.3 points in October, following 84.4 points in September. Companies were less satisfied with their current business. Their expectations improved, but they are still worried about the coming months. The German economy is facing a difficult winter.
