German SME Business' Optimism Reaches New Record High
German government-owned development bank KfW has published a report on the increasingly-positive business optimism among small to medium-sized companies.
The business climate rose by 4.8 points in June to a current level of 28.0, which corresponds to two-and-a-half times a normal monthly change. This is the second time in just three months that the business climate has reached a new record high.
KfW identifies the rising global economy and the fading political risks in European politics after the French election as the cause of companies’ business expectations for the future to rise by 3.4 points.
At the same time, the assessment of the overall business situation rose by 6.2 points to 41.8 points, a level that has never been reached before. This means that a growing amount of companies expect the current situation to improve even further.
On the one hand, these figures show a positive uplift in companies’ confidence. However, the risk of disappointment increases, if the actual development lags behind these high expectations.
Weak Economic Indicators
Despite optimistic companies and a healthy economy, the monthly economic indicators such as industrial production, incoming orders and exports have not yet achieved high results.
“Overall, we assume that the GDP growth in spring has been roughly as strong as in the first quarter (+0.6%)”, said Zeuner.
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Larissa Zimmer. Click subscribe to sign up to ESM: The European Supermarket Magazine.