"The German economy remains buoyant. Satisfaction levels with the current business situation were only slightly higher, but the short-term business outlook improved significantly".
- Ifo Institute
According to the Ifo Institute of Economic Research, German business sentiment improved in June, despite all the turmoil caused by the EU referendum in UK. Economists were expecting the reading to disappoint, falling from 107.70 to 107.50, while the actual result was 108.7 points. The German Business Climate is calculated by a number of surveys from different firms and companies in a handful of sectors, such as construction, wholesales, manufacturing, retailing, services, which altogether provide insight on the German economy. The given release is important, as it tends to also provide a preliminary forecast for future economic activity and the economic conditions in the Eurozone overall. Furthermore, the survey consists of approximately seven thousand businesses, which are asked to assess the economic outlook for the upcoming six months. One of the Ifo's sub survey's showed that the economic conditions in Germany inched higher to 114.5 points in June, compared to the previous figure of 114.2 points. At the same time, the future prospects index was also calculated, showing a 103.1 point reading in the same month, slightly stronger than the previous number of 101.7 points, still in spite of the turbulence caused by the ‘Brexit' poll results. Other forecasts, however, suggest the situation is only going to worsen, as the ‘Brexit' is likely to have a domino effect, causing other ‘ships' to sink as well.
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