Business expectations now stand at a balance of minus 10.7 percentage points, the lowest level since April 1999. In east Germany the business climate also deteriorated, with assessments of the current business situation as well as the six-month outlook being more negative that in February. This is an indication that the economy in Germany will show further weakening in the months ahead. For the first time in nearly two years, sceptical appraisals of export prospects predominate. Even in the case of consumer goods producers, who until recently have see good opportunities in foreign business, now only express cautious optimism.
Firms increasingly regard inventories as too high.
In west Germany production plans are more contractive than in February, although a slight upward revision was recorded in east Germany. The improvement in the business climate in the west German construction industry is attributable to less negative assessments of the current situation and the brightening of the outlook in civil engineering. In east Germany the unfavourable business climate remains unchanged, and expectations of firms in building construction show a clearly increased pessimism. Wholesaling The business situation in west Germany wholesaling cooled off slightly. In both east and west Germany, a more unfavourable assessment of the business situation stood in contrast to declining scepticism regarding the business outlook.