The German Ifo Business Climate index fell to 94.3 points in August, reaching 2012 lows, signaling greater pessimism among companies over the current German environment.
“Companies are again much less satisfied with the current business situation. Pessimism about the coming months has also increased, ”says Clemens Fuest, president of the Ifo Institute in a statement issued Monday.
The release of the index was especially awaited by the markets after last week the German central bank, Bundesbank, projected that Germany could go into technical recession next quarter. According to August data released Monday, the Ifo index fell 1.5 percentage points from 95.8 points in July.
In manufacturing, satisfaction with the current situation has declined again, while expectations have fallen further. “The last time industrial companies showed such pessimism was in the year of crisis 2009,” recalls the Ifo Institute.
“No ray of light has been seen in any of Germany's major industries,” he says. In services, the business climate has also deteriorated and skepticism about the short-term future has grown.
The deteriorating economic environment in Germany has raised alarms about the onset of a new recession. I chief economist at ING Germany points out that “the free fall of the German economy continues”.
“Today's Ifo index marks another low and can be described with one simple word:“ horrible ”. One year the German economy has made a complete turnaround, unfortunately not for the better, but for the worse, ”he said in a statement. research released this Monday.