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Economics Gazette

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November 14, 2019

German business climate reaches six-year high

German business climateThe mood among managers in Germany improved significantly in March. Index Ifo of the business climate rose from 111.1 points to 112.3 points, according to the monthly survey of Munich institute. This is the highest level since July 2011 and the growth is surprising because the economists expect stable value of 111 points.

The growth is accelerating. This is the most important German cyclical parameter and is considered a reliable indicator of development for the next six months. The index for assessing the current situation rose in March to 119.3 points from 118.4 points in the previous month. The forecast of analysts was for a slight decline to 118.3 points. The index of business expectations rose to 105.7 points compared to 104.2 points a month earlier, while economists expected value of 104.1 points.

The mood is improving especially in export-dependent industry. In the retail sector there is also a growth, while the index of retail trade reported a slight decline. The construction sector barometer rose to its highest level since 1991.

Despite the political challenges seem that the economy is in a golden era. According to the economists, this year Germany emerges solid economic growth.

Currently the German economy benefit from the revival of the global situation, leading to growth in production and exports of the industry. A number of think tanks has raised its forecast for growth in the local economy for this year. However, several risks remain – election in France to negotiations Brexit and protectionist measures in key export competitors such as the United States.

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