The Ifo business climate index: The German economy sees light at the end of the tunnel

The recovery of the German economy picks up speed. The Ifo business climate index climbed in June to 86.2 points after 79,7 points in may. Thus, the counter-movement following the dramatic slump in the Wake of the Corona-crisis continues. In April, the mood of German companies had dropped to a historical Low of 74.3 points. The Barometer, based on a monthly survey of about 9,000 businesses in this country, is an important indicator of the mood of the German economy.

Svea Young

editor in the economy.

F. A. Z.

The strong increase in June, primarily to the significantly more optimistic view of the companies is due in the future. The corresponding Index rose by 10.9 points to 91.4 points. But their present position was rated by the firms are more positive than before. “The German economy sees light at the end of the tunnel,” commented the President of the Ifo Institute, Clemens Fuest the Numbers.

Despite the improvement in the great majority of the German industrial scales companies your current location, but still as bad. The same applies to the expectations of the companies in the trade: Many of you to expect a bad development of their business in the coming half year. Overall, the mood of the retailers is less pessimistic than those of the wholesalers.

The on Tuesday by the London-based Markit Institute published the purchasing managers ‘ index also indicates a recovery in the German company. He rose from 32.2 meters in may to 45.8 points and nourishes it to the 50-point mark that signals expansion.

The pre-crisis level will only derive 2022 again

But Economists warn the Figures of the Ifo business climate index, a powerful V-shaped recovery. The strong recovery was, rather, a knee-jerk reaction to the unprecedented slump in March and April, said Jörg Krämer, chief economist of Commerzbank. “In the second half of the year is likely to slow down the upward movement”. A root sign describe the economic picture, therefore, better than a V.

Also, ECB chief economist Philip Lane sees no reason for exuberant optimism. On Wednesday, in an Online event, he said, the gradual Opening up of the economy do in the short term significant growth progress possible. However, because of the extreme depth of the economic downturn in the pandemic, it will still take some time until the pre-crisis’m going to level again. Meanwhile, most Economists expect that this will be no earlier than the beginning of 2022 the case.