The mood among German companies remained unchanged according to an Ifo survey for January, with the business‑climate index holding steady at 87.6 points. Ifo chief Clemens Fuest noted that the assessments of the current situation were slightly revised upward, while expectations slipped a touch. “The German economy is starting the new year without momentum” Fuest said.
In the manufacturing sector, the index rose noticeably, indicating that firms were more satisfied with their ongoing business. Expectations also became less sceptical. Capacity utilisation fell slightly from 78.1 % to 77.5 %, remaining below the long‑term average of 83.2 %.
The service sector saw a deterioration in business climate: the current‑situation rating slipped marginally, and expectations grew more sceptical. In logistics, both the order backlog and overall sentiment dropped, and tourism also experienced a marked cooling.
Retail firms reported a significant improvement, with the index increasing sharply. Companies expressed greater satisfaction with the current business picture, and expectations became less pessimistic. This positive trend was observed in both retail and wholesale, although the indicators for both sectors still lie well below their long‑term averages.
In construction, the business climate brightened, driven by better current business activity. The expectations indicator, however, remained unchanged. Order levels, especially for high‑rise construction, remained weak, a finding highlighted by the Ifo Institute.
