ifo: Business Climate Index Down in April

Sentiment among companies in Germany has significantly deteriorated. The ifo Business Climate Index fell in April to 84.4 points, down from 86.3 in March . This is the lowest level since May 2020. Companies are considerably more pessimistic about the coming months. They also assessed their current situation as worse. The German economy is being hit hard by the Iran crisis.

In manufacturing, the business climate deteriorated. This was due to significantly more pessimistic expectations, especially in the chemical industry. By contrast, companies assessed their current situation as somewhat better. They did, however, increasingly report supply bottlenecks.

Advert

In the service sector, the index fell considerably. Expectations continued to deteriorate. Assessments of the current situation were also worse. The logistics industry in particular is under pressure. The outlook there is grim.

In trade, the business climate dropped significantly. Companies noticeably adjusted their assessments both for expectations and the current situation downward. Retailers are worried in particular that consumers will be more reticent due to rising inflation.

In construction, the business climate plummeted. Expectations fell by almost 10 points. Companies were considerably less satisfied with current business. Hopes for an upswing have been dashed for now.

More information: www.ifo.de

ifo Institut für Wirtschaftsforschung e.V., München