The Ifo Institute’s latest survey shows that German companies’ overall mood has remained unchanged. In the January snapshot, the business climate index held at 87.6 points. Ifo chief Clemens Fuest noted that the figures for the current situation had been slightly raised, while expectations slipped a bit. “The German economy starts the new year without momentum” Fuest said.
“Manufacturing”
In the manufacturing sector, the index rose noticeably. Firms reported higher satisfaction with their ongoing operations, and the pessimism in expectations decreased significantly. However, capacity utilisation fell slightly, moving from 78.1 % to 77.5 %. While this remains below the long‑term average of 83.2 %, it stays consistent with past trends.
“Services”
The service industry, on the other hand, saw a deterioration in business sentiment. The assessment of current conditions slipped, and expectations became more skeptical. Logistics firms reported falling order volumes and lower mood, and the tourism sector’s outlook cooled markedly.
“Retail Trade”
Retail trade experienced a clear rise in the index. Companies expressed greater satisfaction with the current business climate and were less pessimistic about the future. This trend spanned both retail and wholesale trade. Nonetheless, the indicators in these segments remain well below their long‑term averages.
“Construction”
In the construction sector, the business climate brightened, driven by better current business conditions. The expectations indicator, however, stayed unchanged. In particular, the high‑rise construction segment continued to suffer from weak order books, according to the Ifo Institute.