German business confidence steady in November, Ifo shows

German business confidence was fairly steady in November, according to a widely-followed survey.

The Ifo Institute’s business climate index nudged down to 110.4 from 110.5 in October, just a touch below expectations for it to remain unchanged.

The current assessment index rose to 115.6 from 115.1, beating forecasts for a reading of 110.5, while the expectations index ticked down to 105.5 in November from 105.9 in October and missing expectations of a slight rise to 106.

Business confidence in the services sector improved, with the indicator up to 34.8 points in November from 32.3 the month before.

The Ifo said companies gave significantly more favourable assessments of the current situation. Their expectations for the coming months, however,were downgraded slightly.

The sub-index for manufacturing edged down to 14.7 from 16.4 but the construction index rose to 11.4 from 10.3.

Pantheon Macroeconomics said that overall the survey continues to suggest German gross domestic product will rebound in the fourth quarter to about 0.4% quarter-on-quarter, accelerating from a poorly 0.2% quarter-on-quarter growth rate in the third quarter.

“The details show that the services index increased further to 34.8 in November from 32.3 in October, indicating that domestic demand growth remains solid. Elsewhere, the manufacturing sub-index fell back modestly, but construction sentiment increased further indicating that GDP will see a big boost from building capex in Q4. Finally, confidence in both the retail and wholesale sectors also rose.”