Germany: Business Climate at Lowest Reading in More Than Two Years.
London, Monday, 25 July 2022
The Ifo Business Climate indicator for Germany dropped to 88.6 in July 2022, the lowest reading in more than two years, and below market estimates of 90.2 as the economy, which is on the verge of entering a recession, is being burdened by rising energy prices and the fear of a gas shortage.
The country will need to take additional steps to attain the 90 percent of storage capacity established as a target to avoid winter rationing, Germany's gas network regulator said if gas through the Nord Stream 1 pipeline is kept pumped at only 40 percent. In July, the present condition index dropped from 99.4 to 97.7, while the gauge measuring companies' expectations fell from 85.8 to 80.3.
All industries saw a decline in sentiment, including manufacturing (-7.1 vs 0 in June), services (0.9 vs 10.9), trade (-21.6 vs -14.7), and construction (-0.9 vs 10.9) (-17 vs -9.5).
(Source: source: Ifo Institute // Reporting and edit by: The Decision Maker – Technology editors)