Construction Confidence Grows
01 May 2008
Construction was the only german sector in which business confidence grew during August, according to the latest IFO Business Survey. The rise in construction confidence comes despite a slight fall in the IFO Business Climate Index for overall German trade and industry last month, following rises in June and July.
IFO measures current business confidence as a balance value, derived through surveying 7000 German businesses, and August's survey suggests that the balance values for construction rose from -39,9 in July to -35,6 last month. The overall balance value for German trade and industry dropped from -10,9 to -11,7 from July to August as a result of falls in the manufacturing (-0,1 to -0,7), wholesaling (-13,6 to -17,9) and retailing (-24,8 to -27,3) sectors.
IFO president Hans-Werner Sinn said that despite the fall, the Business Climate Index is still higher than it was in the period from March to June this year. “The decline was due to more unfavourable assessments of the current situation by the surveyed firms,”he said. “Expectations for the coming six months are more favourable than July and the survey results do not rule out a moderate improvement in the coming months.”