Business climate in Germany improves slightly in April

The business climate in Germany posted a moderate improvement in April, measured by the Ifo seasonally adjusted index. It inched up to 91.8 from 90.75 in the previous month. The most recent figure is close to a 1-year low, but not as low as it was during the first months of the pandemic in 2020.

The breakdown of the data reveals that the current situation index barely changed from 97.05 in March to 97.19 in April. In the expectations indicator, the improvement is more pronounced, as it increased to 86.71 in April from 84.86 in March.

It inched up to 91.8 from 90.75 in the previous month

The Ifo abbreviation stands for Information and research (Forschung in German). The indicators are based on a monthly survey among 7,000 responses from companies in manufacturing, construction, wholesaling, retailing and services. They are asked to give their assessments of the current business situation and their expectations for the next six months. They can characterize their situation as "good", "satisfactorily" or "poor" and their business expectations for the next six months as "more favorable", "unchanged" or "more unfavorable". The replies are weighted according to the importance of the industry and aggregated. The balance value of the current business situation is the difference of the percentages of the responses "good" and "poor", the balance value of the expectations is the difference between the percentages of the responses "more favorable" and "more unfavorable". The business climate is a means of the balance of the business situation and the expectations.

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