Business Climate in German Retail Improves Slightly
The ifo Business Climate in German retail improved somewhat in August, according to the latest ifo surveys. The indicator rose to -23.1 points, up from -25.4 points in July. Retailers assessed their current business situation as slightly better. Their expectations for the coming months also brightened somewhat. “Nevertheless, the climate remains noticeably gloomy. There are hardly any signs of momentum in the short term, partly because the overall economic development continues to promise more of a headwind than a tailwind for retailers,” says ifo expert Patrick Höppner.
Retailers of electrical goods and electronic household appliances, clothing retailers, and car dealerships reported an improvement in their business situation. Retailers of consumer electronics and DIY stores, on the other hand, perceived a less favorable trend. The business situation is especially poor for sellers of bicycles, clothing, furniture and furnishings, and DIY stores.
“Many retailers are affected by weak demand,” says Höppner. This is reflected, for example, in excess inventories at companies and further decreasing price pressure: The bottom line is that fewer retailers raised their prices in August than at the beginning of 2021. In addition, many retailers are planning to scale back their orders for merchandise and also reduce their staff.
Publication
ifo Konjunkturperspektiven is a monthly German-language online publication that presents the latest results from ifo’s business surveys in the form of graphics and tables.
