In December, the IFO business climate index for industry and trade (to 102.4) has increased for the second time in a row in line with the rise in the expectations index. It even recorded its largest increase in the manufacturing sector since August 2009 as expectations on exports improved again.
In December, the IFO business climate index for industry and trade increased for the second time in a row in line with the rise in the expectations index. The IFO business climate, up by 1 point (to 102.4), also reached its highest level since July 2012.
The decrease of the current index offset the rise of the previous month (to 107.1, after 108.1 in November).
However the expectations index has risen for the second time in a row (to 97.9, after 95.2 in November). This further increase is encouraging as the business outlook improved in construction and particularly in manufacturing sectors. The expectations index even recorded its largest increase since August 2009 in this sector as expectations on exports improved again.
Both the IFO and PMI surveys highlighted an improvement. In December, the composite PMI for activity, up by 1.3 points (to 50.5), was above the 50-threshold for the first time since April 2012, which suggests an increase in activity. Moreover it is likely to increase further, as the most forward-looking indicators of the survey, such as new orders, slightly rose. Indeed index may notably improve in the manufacturing sector at the beginning of 2013 (to 47.4 in December, after 48.4 in November).
This is a further indication that the German economic growth should recover over the next year, as exports should benefit from a slight improvement in world demand. Moreover private consumption is likely to remain well-oriented in line with the low unemployment rate (at 6.9% in November).
By Catherine STEPHAN
To Read the Entire Report Please Click on the pdf File Below.
In December, the IFO business climate index for industry and trade increased for the second time in a row in line with the rise in the expectations index. The IFO business climate, up by 1 point (to 102.4), also reached its highest level since July 2012.
The decrease of the current index offset the rise of the previous month (to 107.1, after 108.1 in November).
However the expectations index has risen for the second time in a row (to 97.9, after 95.2 in November). This further increase is encouraging as the business outlook improved in construction and particularly in manufacturing sectors. The expectations index even recorded its largest increase since August 2009 in this sector as expectations on exports improved again.
Both the IFO and PMI surveys highlighted an improvement. In December, the composite PMI for activity, up by 1.3 points (to 50.5), was above the 50-threshold for the first time since April 2012, which suggests an increase in activity. Moreover it is likely to increase further, as the most forward-looking indicators of the survey, such as new orders, slightly rose. Indeed index may notably improve in the manufacturing sector at the beginning of 2013 (to 47.4 in December, after 48.4 in November).
This is a further indication that the German economic growth should recover over the next year, as exports should benefit from a slight improvement in world demand. Moreover private consumption is likely to remain well-oriented in line with the low unemployment rate (at 6.9% in November).
By Catherine STEPHAN
To Read the Entire Report Please Click on the pdf File Below.