ifo Business Climate Index Rises (April 2023)
Sentiment in German business has improved slightly. The ifo Business Climate Index rose to 93.6 points in April, up from 93.2 points (seasonally adjusted) in March. This was due to companies’ improved expectations. However, companies assessed their current situation as a little worse. German business’s worries are abating, but the economy is still lacking dynamism.
In manufacturing, the index rose somewhat. On the one hand, optimism surrounding future developments grew noticeably. On the other, companies assessed their current business as considerably worse. Production is set to expand in the months ahead. Capacity utilization increased slightly from 84.3 percent to 84.5 percent; it remains above its long-term average of 83.6 percent.
In the service sector, the upward trend in the business climate over recent months came to an end. Service providers assessed their current situation as a little worse. Moreover, pessimism concerning the months ahead began to grow.
In trade, the index fell slightly. Businesses were somewhat less satisfied with their current situation, but their expectations continued to turn less pessimistic. In the face of weaker sales development, many retailers remain reticent about ordering goods.
In construction, the Business Climate Index rose. Expectations for the coming months improved, but worries still loom large. Assessments of the current situation sank to their lowest level since December 2015.
Clemens Fuest
President of the ifo Institute
Survey
ifo Business Climate Index Rises (April 2023)
Sentiment in German business has improved slightly. The ifo Business Climate Index rose to 93.6 points in April, up from 93.2 points in March. This was due to companies’ improved expectations. However, companies assessed their current situation as a little worse. German business’s worries are abating, but the economy is still lacking dynamism.
