Manufacturing (Germany):
Less optimistic export expectations

The current business situation in manufacturing was again appraised a little more favourably than in the previous month. Producers of capital goods even reported a clear improvement whereas the manufacturers of durable consumer goods experienced a noticeable decline. Order stocks are still favourable and production has been increased. There were only isolated reports of excess inventories. Somewhat reduced optimism was expressed regarding the business expectations for the next six months, but for intermediate goods the outlook improved somewhat. The firms were less optimistic than in the previous month with regard to future opportunities for exports. On average, production plans were less frequently geared to expansion, with the exception of the consumer goods area. Personnel expansion is still planned. According to the responses, the scope for price increases will narrow in the coming months. Also in eastern Germany the business situation improved, although producers of non-durable consumer goods reported a decline. The business outlook, however, was seen with less confidence than in the west; in the consumer durable area the sceptical responses even held a slight majority. The firms also anticipate weaker impulses from export business. This was also reflected in less expansive production plans.