ZURICH (MaceNews) – Sentiment among German businesses fell in September for the third month in a row, although not as much as had been expected by economists, according to the latest report from the Munich-based Ifo Institute.
The Ifo Business Climate Index fell to 98.8 in September from a revised 99.6 (99.4) the previous month, slightly below the median of 99.0 in an Econoday survey of economists’ forecasts.
As in previous months, the issue lies within the supply chain rather than overall demand, with Ifo saying that the manufacturing sector is experiencing a “bottleneck recession” due to procurement issues for raw materials and intermediate products. This is “putting the brakes on the German economy.”
Current conditions saw a one point drop to 100.4 in September from 101.4 the previous month, also coming in below the Econoday median of 101.6.
Expectations fell, although not as much as expected, with the September result posting a decline to 97.3 from a revised 97.8 (97.5) the previous month.
Earlier in the month, the ZEW report showed economic sentiment fell sharply, down 13.9 points to 26.5 as a global chip shortage has been hampering the automobile sector.
Ifo will release October business sentiment on October 25 at 10:00am CET.