Germany’s manufacturing and construction industries’ outlook has worsened despite economic sentiment overall picking up in August.
Economic research institute ifo found that sentiment among companies in Germany has brightened in August, albeit very slightly, with the ifo Business Climate Index rising to 89.0 points, up from 88.6 points in July. However, in manufacturing industries, the index fell slightly in this segment.
In construction, the index in August edged down slightly after many months of stability, as companies expressed less satisfaction with the current situation.
The bleak sentiment in manufacturing and construction is confirmed widely in the steel industry. As one service centre manager words it to Kallanish: “We have the worst summer since we started [operations] in the mid-1980s”.
Germany’s GDP in the second quarter meanwhile fell by more than anticipated, Kallanish learns from the federal statistics office, Destatis. It declined 0.3% from Q1 after adjustment for price, seasonal and calendar variations.
The decline in economic performance was therefore 0.2 percentage points greater than communicated at the end of July. Manufacturing industries, including steel, in particular, performed worse than initially assumed. Based on the new data available, June output in manufacturing and in the construction industry, in particular, fell short of expectations, Destatis notes.
Christian Koehl Germany
