The mood in the East German economy continues to deteriorate. According to the Ifo Institute in Dresden, the business climate index fell from 92.3 to 90.2 points in July. The companies surveyed assessed both the current situation and their expectations for the coming months as worse.
According to the institute, the business climate in the manufacturing industry, among others, cooled down. Companies assessed their current business situation more negatively than in the previous month, while their expectations remained unchanged.
Cooling in the service sector
The business climate index also fell in the service sector in July. Companies assessed their current business significantly worse and were also more pessimistic about the coming months.
The business climate also cooled in the retail sector. Companies in both the retail and wholesale sectors reported poorer business compared to June. The outlook for both retail sectors also deteriorated - particularly in wholesale.
Negative trend in the construction industry
The mood in the main construction industry also fell. The construction companies surveyed rated their business situation worse than in June and were also less optimistic about the future.
The Ifo Business Climate East Germany is based on around 1,700 monthly reports from companies in manufacturing, the service sector, trade and the construction industry. They are asked to assess their current business situation and share their expectations for the next six months.
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