PREVIOUS TRADING DAY EVENTS 26 June 2023

The Survey of about 9,000 businesses which asks respondents to rate the relative level of current business conditions and expectations for the next 6 months, the Germanys Ifo index, dropped for the second consecutive month, at 88.5 from 91.7 in May. 

Europes largest economy fights against recession.

The economy faces the prospect of a longer recession as domestic demand and the expectations of exporters have both weakened, Klaus Wohlrabe, the head of Ifo surveys, told Reuters in an interview on Monday. The probability has increased that gross domestic product will also shrink in the second quarter, he said.

Sentiment in the German economy has clouded over noticeably, Ifos president Clemens Fuest said.

The Ifos decline is in line with the drop in the flash purchasing managers index, published on Friday. The report showed that there was a combination of a slower rise in service sector business activity and a deepening downturn in manufacturing output.

It is clear that the industry remains under pressure from waning demand, in line with Fridays PMIs which saw the industry in the Eurozones biggest economy deep in contractionary territory amid rapidly shrinking backlogs and destocking, said Mateusz Urban, senior economist at Oxford Economics.

We feel confirmed in our forecast that the German economy will shrink again in the second half of the year, Commerzbanks chief economist Joerg Kraemer said.

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