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7/4/2023
Markets & Industries
Report
Suppliers: Business climate deteriorates
The business climate for German suppliers deteriorated significantly in June, recording the sharpest month-on-month decline since the outbreak of war in Ukraine. A drop of 12.0 points puts the statistics, which also include figures for the German foundry sector, at -14.1 points after seasonal adjustment.
Both in the assessment of the current business situation and in the expectations for the second half of the year, the companies' assessments are worse than in the previous month. However, while German suppliers report only a slight deterioration in their situation - the value is still slightly positive at 5.5 balance points - expectations slump by over 20 balance points to -31.8 points.
This indicates that the negative trend in the situation assessment will not be halted in the coming months, as it must be viewed against the backdrop of economic developments. The values for the situation assessment declined continuously from just below 50 in the summer of 2021 to 29.6 a year ago to 17.6 balance points at the turn of the year 2022/23.
This indicates that the negative trend in the situation assessment will not be halted in the coming months, as it must be viewed against the backdrop of economic developments. The values for the situation assessment declined continuously from just below 50 in the summer of 2021 to 29.6 a year ago to 17.6 balance points at the turn of the year 2022/23.
Short-term economic policy crisis management is important, but against the backdrop of current developments, it is more important than ever to implement an industrial policy strategy to preserve value chains.
Arbeitsgemeinschaft Zulieferindustrie (ArGeZ)
Overall economic demand flattening out
Whereas the turbulence on the energy and raw materials markets in the previous year was partly met by corona catch-up effects and strained international supply chains, there are now signs of a slowdown in overall economic demand. From the short-term consequences of the energy crisis and high inflation, the focus is increasingly turning to the medium- and long-term effects for Germany as an industrial location."Short-term economic policy crisis management is important, but against the backdrop of current developments it is more important than ever to implement an industrial policy strategy to preserve value chains," is the assessment of the Arbeitsgemeinschaft Zulieferindustrie (ArGeZ), which calculates the business climate index in collaboration with the Munich-based ifo-Institut. It is based on a survey of around 600 companies and covers the foundry industry, aluminum industry, plastics processing, steel and metal processing, nonferrous metals industry, rubber industry and technical textiles, all of which are members of the Arbeitsgemeinschaft Zulieferindustrie (ArGeZ).
