Manufacturing (Germany):
Increases in production

In manufacturing the business climate has brightened. The improvement was due to a rise in the climate indicator in consumer goods production. The producers of intermediate goods reported an almost unchanged business climate, and a slight worsening occurred for capital goods manufacturers. Especially the manufacturers of consumer durables have expanded production and have also clearly reduced their excess inventories. The chemical industry has assessed its order stocks as adequate, whereas mechanical engineering has reported low stock levels for some months. The producers' appraisals of order stocks do not suggest that a clear, involuntary increase in inventories has occurred, which would not be unusual in the final stage of an upswing. The export industry continued to assess its outlook as good even though it was not as optimistic as in the previous month. According to the survey responses, the profit situation has hardly improved in the past half year. The satisfaction with the profit situation has decreased somewhat accordingly. The strong euro, the rising energy costs as well as the higher prices for raw materials have played a role here.