ifo Business Climate Index for Eastern Germany Slips Slightly (September 2021)
Sentiment among companies in eastern Germany cooled a bit in September. The ifo Business Climate Index for the entire regional economy slipped to 101.1 points from 101.4 points in August. Compared to the previous month, companies’ assessments of the current situation declined somewhat, even as their expectations rose slightly.
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In eastern German manufacturing, the business climate cooled significantly in September. Industrial companies rated their current business much less positively and lowered their expectations marginally for the coming months.
The ifo Business Climate Index climbed a little in the eastern German service sector in September. The service providers surveyed lowered their overall assessments of the current situation slightly, while they raised their expectations for the coming months considerably.
The mood in eastern German trade improved a little in September. While both subindices rose in retail, they both declined in wholesale.
In eastern German construction, the business climate turned a lot brighter in September. The construction companies surveyed assessed their current business as perceptibly better than in the previous month, and they raised their expectations for the next few months somewhat.
Joachim Ragnitz and Marcel Thum
Executive Directors, Dresden Branch of the ifo Institute
ifo Business Climate Eastern Germany
(Index, 2015 = 100, seasonally adjusted)
| 09/20 | 10/20 | 11/20 | 12/20 | 01/21 | 02/21 | 03/21 | 04/21 | 05/21 | 06/21 | 07/21 | 08/21 | 09/21 | |
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| Expectations |
Source: ifo Business Survey.
© ifo Institute
ifo Business Climate Eastern Germany by Sector
(Balances, seasonally adjusted)
| 09/20 | 10/20 | 11/20 | 12/20 | 01/21 | 02/21 | 03/21 | 04/21 | 05/21 | 06/21 | 07/21 | 08/21 | 09/21 | |
| Eastern Germany | |||||||||||||
| Manufacturing | |||||||||||||
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| Construction |
Source: ifo Business Survey.
© ifo Institute
The ifo Business Climate Eastern Germany is based on approx. 1,700 monthly survey responses from firms in manufacturing, construction, wholesale, and retail. The firms are asked to give their assessments of the current business situation and their expectations for the next six months. They can characterize their situation as “good,” “satisfactory,” or “poor” and their business expectations for the next six months as “more favorable,” “unchanged,” or “more unfavorable.” The balance value of the current business situation is the difference of the percentages of the responses “good” and “poor”; the balance value of the expectations is the difference of the percentages of the responses “more favorable” and “more unfavorable.” The business climate is a transformed mean of the balances of the business situation and the expectations. For the purpose of calculating the index values, the transformed balances are all normalized to the average of the year 2015.
