Results of the May 2014 Ifo Business Survey
Ifo Business Climate Index Falls
The Ifo Business Climate Index for industry and trade in Germany fell to 110.4 points in May from 111.2 points last month. Assessments of the current business situation were no longer as favourable as in April. Companies are also less optimistic about future business developments. A lull was seen in the German economy in May.
In manufacturing the business climate index fell slightly, but remained at a high level. Although assessments of the current business situation improved marginally, manufacturers are slightly less optimistic about future business developments. Manufacturers continue to expect stronger impulses from exports.
In wholesaling the business climate index fell markedly, after April’s sharp increase. While assessments of the current business situation were clearly less favourable, assessments of the business outlook deteriorated only marginally. In retailing the business climate also clouded over. Retailers were once again slightly less satisfied with their current business situation. For the first time in six months they were also somewhat pessimistic on balance about future business developments.
In construction the business climate index also declined slightly. Contractors were somewhat less satisfied with their current business situation than in April. The six-month business outlook also continued to deteriorate.
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 May 2014: German Economy Catches its Breath | Jun 4, 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.