The business climate in the German economy developed better than expected in the last month of 2022. According to the Ifo Institute, companies are assessing their current situation better again. Previously, the indicator fell six times in a row.
The mood in the German economy has "lightened up noticeably". The business climate index determined by the Munich Ifo Institute rose to 88.6 points in December, after 86.4 points in November, as the institute announced. "The German economy draws hope at Christmas," said Ifo President Clemens Fuest. The companies rated their current situation better again, explained the Ifo. Previously, the situation indicator had fallen six times in a row. The expectations of companies have also improved noticeably.
In manufacturing, the index rose significantly; According to the Ifo survey, the business climate improved in almost all branches of industry. "In particular, the expectation indicator climbed up." Companies were also happier with current business. In the service sector, the business climate improved again "significantly", as the Ifo announced. This is primarily due to the waning pessimism with regard to the next six months. The service providers also rated their current situation better.
In retail, the index determined by the institute rose to its highest value since June. The companies assessed their situation slightly positively for the first time since August, the Ifo explained. The outlook is still pessimistic, but less than in November. In contrast, the business climate only deteriorated in the main construction trades. Companies were slightly less satisfied with current business. Their expectations brightened slightly, but remained "very pessimistic".
Around 9,000 companies answer questions from the Ifo Institute every month for the business climate index. They are asked to assess their current business situation and their expectations for the next six months.
