- The IFO Business Climate Index stood at 88.6 in July.
- The current economic valuation fell to 97.7 this month.
- The expectations index fell to 80.3, below estimates.
The German IFO Business Climate Index fell to 88.6 in July, worsening last month’s 92.2 points (revised 92.3) and consensus estimates of 90.5. This is the worst result recorded by the indicator in 25 monthsspecifically since June 2020.
For its part, the current valuation fell to 97.7 points, falling below June’s 99.4 (upwardly revised from 99.3) and 98.2 expected. This is the lowest level for this IFO in the last three months.
The IFO expectations index, which indicates companies’ forecasts for the next six months, fell sharply to 80.3 points in July, compared to 85.5 in the previous month (revised downward from 85.8) and the market forecast of 83.0. The forecast of expectations is the lowest seen in 27 months, specifically since the explosion of the covid pandemic in April 2020.
market reaction
The EUR/USD has fallen to daily lows at 1.0178 after the data release, but has subsequently bounced higher, rising to 1.0220. At time of writing, the pair is trading above 1.0216, gaining 0.02% daily.
About the German IFO
The main IFO Business Climate Index was rebased and recalibrated in April after the IFO Research Institute changed the series from the 2000 base year to the 2005 base year beginning in May 2011 and then changed the series to include services beginning in May 2011. April 2018. The survey now includes 9,000 monthly responses from companies in the manufacturing, services, trade and construction sectors.
Source: Fx Street
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