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Results of the July 2014 Ifo Business Survey

Ifo Business Climate Index Continues to Fall

The Ifo Business Climate Index for industry and trade in Germany fell to 108.0 points in July from 109.7 points last month. This marks the third decrease in succession. Assessments of the current business situation were less favourable than in June. Companies were also less optimistic about future business developments. Geopolitical tensions are taking their toll on the German economy.

In manufacturing the business climate index fell considerably for the third month in succession. Assessments of the current business situation were clearly less favourable. Expectations also continued to deteriorate. The export outlook fell to its lowest level for over a year, but the majority of manufacturers remained positive. Capacity utilisation rates dropped by 0.3 points to 84.0 percent.

In wholesaling the business climate index fell markedly. After a very strong month in June, wholesalers were no longer quite as satisfied with their current business situation. Expectations declined for the third month in succession. The business climate also clouded over considerably in retailing. Retailers’ assessments of their current business situation were no longer quite as favourable as in June. Scepticism regarding future business developments reached its highest level for over 12 months.

In construction the business climate index also fell after last month’s slight recovery. Assessments of the current business situation were somewhat less favourable than in June, but remained at a high level. Contractors were also slightly less optimistic about their six-month business outlook.

Hans-Werner Sinn
President of the Ifo Institute

Results of the Ifo Business Survey in Germany in all details (in German)

  1. "ifo Konjunkturperspektiven 07/2014", ifo Institut, München, 2014 | Details

Summary of the Results

  1. Ifo Business Survey for July in Brief: Geopolitical Tensions Take Toll on German Economy | Aug 13, 2014 | Information service | Details

Ifo Business Climate Germany (Index)

Image Ifo Business Climate Germany (Index)

Business Situation and Expectations by Sector (Balances)

Image Business Situation and Expectations by Sector (Balances)

Ifo Business-Cycle Clock

Image Ifo Business-Cycle Clock

Time series


Ifo Business Climate Germany (Index, 2005 = 100, seasonally adjusted)
 07/1308/1309/1310/1311/1312/1301/1402/1403/1404/1405/1406/1407/14
Climate 106.2 107.6 107.8 107.5 109.4 109.5 110.6 111.3 110.7 111.2 110.4 109.7 108.0
Situation 110.1 112.0 111.4 111.3 112.3 111.6 112.4 114.4 115.2 115.3 114.8 114.8 112.9
Expectations 102.5 103.4 104.4 103.9 106.6 107.4 108.8 108.2 106.3 107.2 106.1 104.8 103.4
Source: Ifo Business Survey

Ifo Business Climate Germany (Balances, seasonally adjusted)
 07/1308/1309/1310/1311/1312/1301/1402/1403/1404/1405/1406/1407/14
Trade and Industry 5.1 7.8 8.2 7.7 11.3 11.4 13.6 14.8 13.7 14.7 13.2 11.8 8.6
Manufacturing 8.0 11.2 12.1 11.2 15.4 15.5 17.7 19.7 19.0 20.1 19.0 15.6 12.4
Construction -1.3 -4.0 -6.0 -5.9 -2.9 1.3 2.3 0.5 -3.6 -3.5 -4.1 -3.7 -5.5
Wholesaling -0.2 8.3 5.6 8.1 11.8 9.3 15.3 12.6 10.9 14.3 11.3 12.5 9.3
Retailing 3.0 3.1 6.3 3.6 5.3 4.7 4.2 8.4 8.5 7.6 4.8 8.0 3.8
Source: Ifo Business Survey

Explanatory note

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.

Contact

Dr. Klaus Wohlrabe

Ifo Institute
Ifo Center for Business Cycle Analysis and Surveys
Phone: +49(0)89/9224-1229
Fax: +49(0)89/9224-1463
Email: wohlrabe@ifo.de
Website


Short URL: www.ifo.de/w/6NDgmsTU