German ifo business climate forex
Ifo Institute for Economic Research.
Released monthly by the Munich-based Information and Forschung IFO Institute for Economic Research, the IFO Business Climate Survey measures the current German business conditions. The survey is conducted monthly by phone, and is based on approximately 7, responses to questionnaires from businesses across different sectors such as manufacturing, construction, retail and wholesale.
Business owners and senior executives are asked to submit their assessments of current business conditions and expectations for the next six months. The Business Climate Balance is constructed as the mean of the balances of the current business situation and expectations.
Ifo Business Climate Survey
The center-line of the index is , and a reading above indicates that the business climate has become healthier. A figure below signifies an unfavorable business climate. The IFO Business Climate Survey is a widely followed early indicator for economic development in Germany.
As an indicator of economic activity, the index has the advantage of being more frequently compiled and more rapidly accessible compared to official statistic like GDP. A closer look into the report also reveals which industries in the German economy are doing well and which are struggling.
IFO Business Climate Survey - dikykex.web.fc2.com
The IFO Business Climate Index is particularly important in forecasting turning points in economic growth. The index reliably indicates a cyclical turning point if there is movement in a particular direction three months in succession.
Frank Denneman
Germany is responsible for approximately a quarter of the total Euro-Area GDP. The survey results tend to create significant market impact upon release due to its correlation with economic conditions in the country.
Since Germany is the largest economy in the euro zone, traders consider the IFO Business Climate Survey as an early indicator of the euro zone business environment.
Higher than expected index readings are generally considered as positive or bullish for the EUR, while a lower than expected reading is seen as negative or bearish for the currency. Historical Overview of German IFO Business Climate Survey: