Investment and Leasing: Dynamic Loses Impetus

The investment indicator, which is jointly produced by the ifo Institute and the German Association of Leasing Companies and based on German leasing companies’ assessments of their business situation and expectations, signals a nominal 4.1% increase in equipment investment for 2018, versus 4.3% last year. Growth is also expected for the year ahead, albeit at a slightly slower pace. The drivers behind the continued increase in equipment investment are the 8-year upturn in leasing and the steady increase in capacity utilisation in the German economy, which has turned into a clear capacity shortage, especially in construction. Investments to increase capacity are expected to continue to rise.