Dear Readers, The mood on the German executive floors is becoming uncomfortable, writes the ifo Institute. In fact, the ifo business climate continued to decline in July. In industry, which we regard as a sentiment indicator for the global economy and the stock markets, the business climate indicator is even in free fall. Especially the export suffers (graphic 1).

Dear Readers, We have just received the new estimate of the team around Oliver Schlick, who regularly calculates the capital market seismograph. As you know, it distinguishes between three phases: "green" (quiet market = buy), "yellow" (turbulent market with positive expectation = invest, but with hedge) and "red" (turbulent market with negative expectation = do not invest). Currently, the probability of a calm, positive stock market ("green, buy or hold") is only 27 percent. However, the probability of a turbulent, volatile market with a positive trend ("yellow") has risen to 34 percent. The probability of negative turbulence reaches 39 percent. "Of particular interest is the increase in the probability of positive-turbulent markets. In...

Dear Readers, In June, the ifo business climate fell further to its lowest level since November 2014. In industry, which we regard as a sentiment indicator for the global economy and the stock markets, pessimism increased again after a brief improvement in sentiment in May. As in recent months, favourable assessments in the service sector and in construction are still supporting the overall climate. However, industry is already in recession today and is ensuring that the ifo traffic light remains on red (chart below). The ifo traffic light indicates the monthly probability of an expansive economic development. Red traffic light values mean: The probability of expansion is less than one third. This points to a contraction of the economy...

Dear Readers, The ifo business climate rose in March for the first time in six months. This, at first glance, good news, however, is put into perspective when looking at the individual areas. The service sector, trade and construction were responsible for the increase. In industry, which is regarded as a sentiment indicator for the global economy and the stock markets, the decline continued steeply (Chart 1). The expectations of entrepreneurs in the manufacturing sector have now reached their lowest level since November 2012.

Dear Readers, The ifo business climate continued to fall in February. The worries in the German executive floors are increasing, according to the Munich economic researchers. The results of the ifo survey and other indicators would point to economic growth of 0.2 percent in the first quarter of 2019. After a minus of 0.2 percent in the third quarter and a black zero in the fourth quarter of 2018, this means that the German economy is stagnating. It can get even worse in the future. As you know, we are closely monitoring the expectations of the 9000 entrepreneurs surveyed by the ifo Institute. These point further down. Pessimism is increasing across the board. This is particularly pronounced in the industry, which is so important for Germany....