ifo Business Climate Index Falls (August 2023)
Sentiment among German managers has darkened further. The ifo Business Climate Index slipped to 85.7 points in August, down from 87.4 points (seasonally adjusted) in July. This is its fourth consecutive fall. Assessments of the current situation fell to their lowest level since August 2020. Moreover, companies are increasingly pessimistic about the months ahead. The German economy is not out of the woods yet.
In manufacturing, the Business Climate Index fell. Companies were particularly less satisfied with their current situation; this indicator dipped into negative territory for the first time since October 2020. Expectations remained starkly pessimistic. Companies complained ever more loudly of a decline in new orders.
In the service sector, the business climate cooled notably. Service providers were clearly less satisfied with their current situation. They are also expecting a further deterioration. The weakness in manufacturing is also weighing on the transport and logistics industry.
The Business Climate Index fell in trade, too. Businesses assessed their current situation as considerably more negative. The outlook also turned even gloomier.
In construction, the Business Climate Index continued its nosedive. Companies were noticeably less satisfied with their current business situation. What’s more, pessimism concerning the coming months became even more widespread.
Clemens Fuest
President of the ifo Institute
Survey
ifo Business Climate Index Falls (August 2023)
Sentiment among German managers has darkened further. The ifo Business Climate Index slipped to 85.7 points in August, down from 87.4 points in July. This is its fourth consecutive fall. Assessments of the current situation fell to their lowest level since August 2020. Moreover, companies are increasingly pessimistic about the months ahead. The German economy is not out of the woods yet.
