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Economy in Brief

The German IFO Index Shows a Broad Weakening
by Robert Brusca September 28, 2007

The German IFO Index shows a broad weakening in its various sector indexes. Like the EU index, the decline though broad is also slow.

The business expectations index is now only in the top one-third of its range the current situation and overall climate indexes sport readings in the low 80 percentile of their respective ranges.

For MFG the reading overall is a still strong 92 percentile for the current situation but the forward-looking readings are much deteriorated from that. Business expectations are only in the top third of the range. as is month-to-month demand and orders on hand. Foreign orders on hand remain much stronger residing in the 96th percentile of their range.

The 3-month outlook sector is relatively firm with expected MFG activity in the 80th percentile. But orders expectations have been steadily slipping and are now just above the range midpoint at 57% for retail orders. Wholesale orders expectations are firm, in the top third of their range. Export expectations are still in the low 80th percentiles – but all of these readings are slipping. Employment expectations have slipped to the bottom third of their range.

IFO Survey: Germany
  Percent:Yr/Yr Index Numbers
  sep
07
aug
07
jul
07
jun
07
may
07
current average curr
/Avg
%tile
Biz Climate -0.9% 0.7% 0.8% 0.2% 2.8% 104.2 95.7 108.9% 81.0%
Current Situation -1.3% 2.4% 2.4% 1.6% 4.7% 109.9 94.8 115.9% 83.2%
Biz Expectations: Next6-Mos -0.4% -1.1% -0.9% -1.2% 1.0% 98.7 96.7 102.1% 69.1%
Manufacturing: sep
07
aug
07
jul
07
jun
07
may
07
current average curr
/Avg
%tile
Current Situation
MFG 0.8% 4.4% 4.5% 4.4% 6.7% 110.3 92.3 119.5% 92.8%
Biz Expectations: Next 6-Mos
MFG -1.4% -1.9% -0.4% -2.8% 0.9% 97.0 96.5 100.6% 66.1%
Activity (m/m)
MFG -4.5% 1.0% -1.9% -3.7% 2.0% 102.9 97.0 106.1% 77.8%
Demand M/M
MFG -6.3%> -2.8% -3.3% -7.1% 0.5% 100.3 97.1 103.3% 65.6%
Orders on hand
MFG -4.7% -2.4% -2.8% -3.6% -0.9% 101.2 96.4 104.9% 69.0%
Foreign orders on hand
MFG 0.5% 2.5% 1.9% 2.0% 2.5% 111.3 94.5 117.8% 96.0%
Yr/Yr percentage changes in underlying Indexes
IFO outlook for 3-Months ahead
3-Mos ahead Percent: Yr/Yr Index Numbers
Expected Activity sep
07
aug
07
jul
07
jun
07
may
07
current average curr/
Avg
%tile
MFG -0.9% 2.4% 1.0% 3.3% 0.5% 100.3 96.8 103.7% 80.6%
Orders expectations
Retail Orders Expectations -1.8% -10.5% -11.7% -10.9% -4.7% -18.0 -17.6 102.2% 57.3%
Wholesale -0.1% 7.7% 7.0% 5.6% 15.7% -1.1 -13.9 7.9% 67.1%
EXPORT Biz Expectations
MFG -1.4% 0.9% 0.0% 0.5% -0.5% 102.3 98.4 103.9% 83.0%
Employment Expectations
MFG 4.1% 4.1% 7.4% 8.4% 7.5% 104.5 96.0 108.8% 33.3%
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