German business sentiment deteriorates in June - Ifo
By Michele Maatouk
Date: Friday 24 Jun 2022
(Sharecast News) - German business sentiment unexpectedly deteriorated in June, according to a survey released on Friday by the Ifo Institute.
The business climate index fell to 92.3 from 93.0 in May, coming in below expectations for a reading of 92.9.
Meanwhile, the expectations index edged down 85.8 in June from 86.9 the month before, while the current situation gauge printed at 99.3, down from 99.6.
The manufacturing index declined to 0.3 from 2.7, while the service sector gauge improved to 10.8 from 8.2. The index for trade came in at -14.8 in June compared to -10.7 in May, while the construction index printed at -9.7 versus -13.4 a month earlier.
Ifo president Clemens Fuest said: "Rising energy prices and the threat of gas shortages are of great concern to German business."
ING said: "The reasons for dampened optimism are clear: the war in Ukraine, lockdowns in China and the consequent supply chain frictions, higher costs and prices, and weakening demand.
"It is actually not the first time German business sentiment seems to have had a delayed reaction to global events."
Pantheon Macroeconomics said: "The IFO continues to tell a story of depressed macro-conditions in Germany's economy, a message that is now increasingly supported by the PMIs, which fell further in June.
"The good news is that downturn in expectations seem to be stabilising. The bad news is that a rebound seems far off, which means that expectations appear to be stabilising at levels firmly consistent with recession."
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