Germany: Business confidence stabilizes in May after five consecutive declines
Following a series of weaker-than-expected data in the year to date, sentiment data for the private sector in May provided some respite. Business confidence was stable at the prior month’s seasonally-adjusted 102.2 (previously reported: 102.1) after falling since November of last year. As a result, the confidence index remained above the 100-point mark separating optimism from pessimism among firms. The result reflected a slight improvement in firms’ view of the current business situation, while their expectations worsened marginally.
Sectoral data showed that sentiment was constrained by slightly lower optimism in the manufacturing sector; however, sentiment among firms in the trade, service and construction sectors improved notably. Confidence in the trade sector improved the most, chiefly due to a more upbeat view of current business conditions, while firms’ expectations remained virtually unchanged. Sentiment among firms in the service sector improved owing to more optimistic expectations, but their assessment of current business conditions worsened. Furthermore, confidence reached a new record high in the construction sector, largely due to a markedly improved view of the current business climate. Construction firms’ view of the future business climate was, however, slightly less rosy than the prior month.