Generally Favourable Business Climate Despite Slightly Weaker Expectations
Information EconomyDevelopment of Germany’s Information Economy
Economic sentiment among companies in the information economy has been largely positive in the second quarter of 2019. The ZEW sentiment indicator for the information economy is currently at 63.6 points, signalling that the majority of companies continue to have a positive view of the current economic climate. The sub-indicator of business expectations, however, shows a bleaker outlook for the third quarter of 2019. The sentiment indicator is the result of a survey conducted among firms in the German information economy by the Mannheim-based ZEW – Leibniz Centre for European Economic Research in June 2019 (further information on the survey can be found at the bottom of this press release).
The slight decline in the sentiment indicator for the entire information economy is due to a reverse trend of the two sub-indicators. The sub-indicator for the business situation improved in the second quarter of 2019, whereas business expectations for the third quarter of 2019 deteriorated slightly. The sub-indicator for business expectations decreased by 3.7 points compared to the previous quarter. With a current reading of 64.4 points, the indicator remains, however, clearly above the critical 50-point mark. As a result, the majority of companies are optimistic about future economic development. With a value of 62.9 points, the sub-indicator for the business situation signals that the majority of companies also recorded positive economic development in the second quarter of 2019.
Economic mood among media service providers and knowledge-intensive service providers worsens
Economic sentiment among companies in the ICT sector improved somewhat after the two previous quarters had signalled a slight economic slowdown. The sentiment indicator increased by 0.7 points in the second quarter of 2019, reaching a current total of 71.6 points. ICT companies remain predominantly positive about the business situation, as well as business expectations. Although the sub-indicator for business expectations fell by 6.6 points from a very high level in the previous quarter, the current level of 71.1 points nevertheless signals strong optimism in the ICT sector, with the assessment of the business situation being even slightly better (72.1 points).
The economic mood among media service providers deteriorated further in the second quarter of 2019. After the sentiment indicator had already slipped below the critical 50-point mark in the previous quarter, it lost another 4.2 points. It currently stands at 43.2 points, signalling a rise in pessimism among media service providers. Decisive for the negative development of the sentiment indicator is the deterioration in the business situation. The corresponding sub-indicator is currently at 36.1 points, which shows that business in the second quarter of 2019 was much worse than expected. As far as assessing business expectations is concerned, the share of companies with optimistic forecasts predominates, if only barely.
The economic climate among knowledge-intensive service providers deteriorated slightly in the second quarter of 2019. The sentiment indicator fell by 0.8 points and remains at a solid level of 61.5 points. The two sub-indicators for the business situation and business expectations are currently almost on a par at 61 and 62 points, respectively.
