The ifo Business Climate Index fell to 92.3 points in June, down from 93.0 points in May. Companies were slightly less satisfied with the current business situation and expectations were more pessimistic, as the ifo Institute announced in its business climate index for June.

In the manufacturing sector, the index has suffered a significant setback. Companies assessed the current situation as slightly worse. They are also noticeably more pessimistic about the second half of the year. The chemical industry in particular is extremely worried.

In contrast, the business climate in the services sector has improved noticeably. This was due to significantly less skeptical expectations. Service providers rated the current situation slightly better. The hospitality industry is experiencing a good summer. Transport and logistics, on the other hand, are pessimistic about the second half of the year.

The indicator fell sharply in the retail sector. Retailers are significantly less satisfied with current business. Expectations fell to their lowest level since April 2020. Wholesalers and retailers are extremely worried about the coming months.

The business climate rose in the main construction sector. Companies assessed the situation better. Their expectations remained pessimistic, albeit slightly less so than in the previous month.

Export expectations down

The mood among German exporters has deteriorated slightly. Ifo export expectations fell to plus 3.7 points in June, down from plus 4.4 points in May. Logistics problems and a high level of uncertainty are depressing the outlook for the German export industry.

In the automotive industry, however, optimistic expectations have returned. For the first time since February, the sector is expecting growth in foreign business again. Mechanical engineering, beverage and clothing manufacturers also expect to export more.

Manufacturers of electrical equipment suffered a significant setback, with their expectations falling to their lowest level since June 2020. Growth is rarely mentioned anymore. Furniture manufacturers and printers are expecting a decline in foreign sales.