German business confidence dips for second consecutive month – KIRO 7 News Seattle

BERLIN – (AP) – German business confidence has fallen for the second straight month amid concerns about the ongoing impact of the coronavirus pandemic and cloud companies’ outlook for delivery bottlenecks, a closely watched survey showed on Wednesday.

The Ifo Institute announced that the confidence index for Europe’s largest economy fell from 100.7 points in July to 99.4 points in July. While executives’ assessments of the current situation improved, their prospects for the next six months were significantly worse.

“Concerns are growing, especially in the hospitality and tourism sectors,” said Ifo. “Delivery bottlenecks for preliminary products in production and worries about increasing numbers of infections are a burden on the economy.”

On Tuesday, the official statistics showed that the German economy grew by 1.6% between April and June compared to the previous quarter, somewhat better than initially reported. In the second quarter of this year, coronavirus infections flared again and then fell to very low levels, prompting authorities to relax many restrictions as the country’s vaccination campaign picked up.

At the same time, however, the economy was hit by supply chain problems, including disruptions from a ship blocking the Suez Canal and delays in the production and delivery of microchips.

The German Bundesbank said this week that it expected the economy to grow “significantly faster” in the summer due to the loosened pandemic restrictions. The number of new infections is now increasing steadily, driven by the Delta variant, but new blocking measures are not expected.

The ifo survey is based on monthly responses from around 9,000 companies across the entire German business spectrum.

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