Construction (Germany):
Price increases halted

In construction the business situation worsened in August - both for structural as well as for civil engineering - following on the improvement reported in July. Equipment utilisation (69%) increased but still remained below the level of 12 months ago. Order reserves remained at 2.5 production months, with a slight increase in structural and a decrease in civil engineering. The dissatisfaction with current order stocks weakened again somewhat; one quarter of the building contractors reported constraints due to lack of orders (previous year: 16%). With regard to the six-month outlook, confidence weakened again; leeway for raising construction prices will tend to narrow in the coming months. As in previous months, the contractors still expect to hire addition staff. In eastern German construction the business situation was less favourable than in July. Order reserves were more frequently assessed as insufficient. Whereas equipment utilisation rose to 74%, the range of order reserves declined to 2.0 production months. Also in eastern Germany price increases will be more difficult to achieve in the coming months.