Results of the January 2014 Ifo Business Survey
Ifo Business Climate Index Rises
The Ifo Business Climate for industry and trade in Germany improved for the third time in succession. Assessments of the current business situation rose to their highest level since June 2012. Expectations regarding future business developments reached their most optimistic level in almost three years. The German economy made a promising start to the New Year.
The business climate index in manufacturing continued to rise. Manufacturers assessed their current business situation far more favourably. Optimism about future business developments increased significantly, partly due to better export expectations. Capacity utilisation rates rose slightly by 0.2 percentage points.
The business climate index in wholesaling increased significantly. Wholesalers were far more satisfied with their current business situation. Optimism regarding the business outlook also rose to a two year high. In retailing, by contrast, the index fell slightly primarily due to downward revisions of assessments of the current business situation. Retailers, however, were somewhat more optimistic about future business developments.
The business climate index in construction continued to rise. Although contractors assessed their current business situation as slightly poorer than last month, expectations improved considerably and reached an even higher level than during the same period last year.
President of the Ifo Institute
Results of the Ifo Business Survey in Germany in all details (in German)
Summary of the Results
Results of the Ifo Business Survey (Summary) of January 2014: German Economy Makes a Promising Start to the New Year | Feb 5, 2014 | Information service | Details
Ifo Business Climate Germany (Index)
Business Situation and Expectations by Sector (Balances)
Ifo Business-Cycle Clock
The Ifo Business Climate Index is based on ca. 7,000 monthly survey responses from firms in manufacturing, construction, wholesaling and retailing. The firms are asked to give their assessments of the current business situation and their expectations for the next six months. They can characterise their situation as “good”, “satisfactory” or “poor” and their business expectations for the next six months as “more favourable”, “unchanged” or “more unfavourable”. The balance value of the current business situation is the difference between the percentages of the responses “good” and “poor”, the balance value of the expectations is the difference between the percentages of the responses “more favourable” and “more unfavourable”. The business climate is a transformed mean of the balances of the business situation and the expectations. For the purpose of calculating the index values, the transformed balances are all normalized to the average of the year 2005.