Enlarge image
Employees at Heidelberger Druckmaschinen: Hope for the summer
Photo: Uwe Anspach / /dpa
At the start of the year, the mood in the German economy brightened for the first time since June.
The Ifo business climate index surprisingly rose to 95.7 points in January.
In December, the indicator was still at its lowest level since February 2021.
"The German economy is starting the new year with a glimmer of hope," said Ifo President Clemens Fuest.
The 9,000 bosses surveyed were more skeptical about the situation in their companies than they had been in the past, but were much more optimistic about the future.
Despite the current Omicron wave, the business climate brightened in all the sectors considered.
»There are positive signals.
But it's still too early to speak of a trend reversal," said ifo expert Klaus Wohlrabe.
The delivery bottlenecks in German industry eased noticeably at the beginning of the year, said Wohlrabe.
"But there is still no relaxation on the price front." At least every second industrial company wants to raise its prices further.
It looks very similar in retail and wholesale.
The inflation rate reached 5.3 percent in December, the highest level in almost 30 years.
What are the consequences of the Ukraine conflict?
The German economy had probably shrunk somewhat at the end of 2021, by 0.5 to 1.0 percent according to an initial estimate by the Federal Statistical Office.
Most economists assume that the pandemic wave caused by the corona variant Omicron will also slow down the economy in the current first quarter.
Analysts also refer to the Ukraine conflict, which has come to a head.
The Ifo business climate index does not yet reflect the current situation on the eastern border of Ukraine, said Thomas Gitzel from VP Bank.
»Companies from the manufacturing sector in particular are likely to follow the situation with concern.
Serious political conflicts currently harbor the risk that the tense supply chain situation will further deteriorate,” he warned.
The stock markets are also nervous.
Asian markets ended trading lower.
Wall Street initially fell on Monday, but then recovered the losses.
This recovery on the US stock market gave the Dax a boost.
After the fall in prices at the beginning of the week, the German stock market opened with price gains on Tuesday.
The Dax was 0.72 percent higher in early trading at 15,120 points.
The day before, concerns about the escalating Ukraine crisis and the upcoming US central bank meeting had ultimately brought the leading index down 3.8 percent.
While investors are eagerly awaiting interest rate hikes in the United States, industry is primarily concerned about the corona situation in China.
Because business with the People's Republic is weakening.
Significantly fewer exports to China
Exports to China fell by 7.9 percent in December compared to the same month last year to 8.5 billion euros, according to preliminary calculations by the Federal Statistical Office.
On the other hand, trade with the most important customer, the USA, was also going well at the end of the year: exports there increased by 17.6 percent to 10.7 billion euros.
One reason for the weak China business is likely to be the zero-Covid strategy of the government in Beijing.
Even with a small number of outbreaks, this leads to the closure of entire factories and port facilities.
The International Monetary Fund (IMF) has called on the leadership in Beijing to abandon their strict course.
The restrictions proved to be a strain - for both the Chinese and the global economy, said IMF chief Kristalina Georgieva.
The Federation of German Industries (BDI) also fears significant slowdowns in business with the People's Republic.
"Should the omicron variant also spread more quickly and easily in China, this could again become a bottleneck for global supply chains and fuel a recession in certain sectors of German industry," warned the BDI.
The bottlenecks could probably also be accompanied by higher prices.
mmq/Reuters/dpa
