Business confidence in Germany continues to sputter up and down as the economies of the countries around it disintegrate. Consumer spending within its borders and trade with countries outside the European Union have not offered enough momentum for Germans to believe that regional trouble can be overcome. So the Ifo Business Climate Index fell for this month:

After rising sharply last month, the Ifo Business Climate Index for German industry and trade edged downwards in March. Companies were slightly less positive about their future business outlook than in February, but assessed their current business situation almost as positively as last month. The German economy remains on track in a challenging environment thanks to strong domestic demand.

In manufacturing the business climate indicator fell. Manufacturers assessed both their current business situation and future business developments less optimistically than last month. Export expectations sank clearly, but remain positive.

After the sharp upturn last month, the business climate in wholesaling deteriorated considerably. Wholesalers expressed less optimism about both their current business situation and future business developments. In retailing, on the other hand, the business climate index rose slightly. Retailers were somewhat more satisfied than previously with their current business situation and less pessimistic about their business outlook.

In construction the business climate index rose to its highest level since German reunification. Survey participants expressed far greater satisfaction with their current business situation. Optimism regarding further business developments fell somewhat, but remains at a very high level.

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