German business sentiment proves resilient in September - Ifo
Business confidence in Germany deteriorated less than expected in September, according to a survey released by the Ifo Institute on Monday.
The business climate index slipped to 103.7 from 103.9 in August, beating expectations for a drop to 103.2.
The current situation index was steady at 106.4 versus expectations for a decline to 106.1. Meanwhile, the expectations index nudged down 101.0 from 101.2, compared to expectations for a reading of 100.2.
The manufacturing index fell to 23.5 this month from 24.3 in August, while the service sector gauge ticked up to 32.5 from 32.4. The index for trade rose to 11.6 from 10.6 and the index for construction pushed up to 31.9 in September from 29.6 the month before.
Clemens Fuest, president of the Ifo Institute, said: "Firms’ assessments of their current business situation deteriorated marginally, but remain at a high level. Companies also scaled back their business expectations somewhat. Despite growing uncertainty, the German economy remains robust."
Jennifer McKeown, chief European economist at Capital Economics, said: "September’s very small fall in the Ifo business climate ndicator was a pleasant surprise, suggesting that the German economy will continued to grow quite strongly in the near term.
"On recent form, the Ifo looks consistent with healthy annual German GDP growth of over 2%. The current conditions index was unchanged at a high level while expectations fell only slightly."
Pantheon Macroeconomics said the headline business index was "decent" and consistent with resilience in the services PMIs released last week.
“Remember that the IFO recently was re-based and re-weighted, which means that services are now a much bigger share of the survey.
"The sector details were consistent with the PMIs. The manufacturing index fell, albeit marginally, while the services index rose. Finally, the construction index soared to a new all-time record high, indicating that activity in the building sector will remained firm in Q3, and that growth will be strong into year-end too."