Shortages cast a dull sentiment in the economy

Frankfurt / Munich (dpa) – The recovery of the German economy from the Corona low is stalling. The order books of many companies are full, but delivery bottlenecks and raw material shortages are slowing production in Germany as an export nation.

The mood in the German economy deteriorated for the fourth time in a row in October: The Ifo business climate, Germany’s most important economic barometer, fell by 1.2 points compared to the previous month to now 97, 7 points, as the Ifo Institute announced on Monday in Munich.

After According to the Bundesbank’s assessment, Germany’s economic performance will “probably still fall short of its pre-crisis level from the final quarter 2019 in autumn too”. In its October monthly report, which was presented on Monday, the Bundesbank revised its growth forecast for the current year, which it presented just over four months ago, downwards: «In the year 2021 overall, GDP is likely to grow significantly less than in the June projection of the Bundesbank expected. ” In June, the central bank had forecast growth in real gross domestic product (GDP) of 3.7 percent for the current year.

“The corona crisis has turned into a scarcity crisis,” analyzed Thomas Gitzel, chief economist of VP Bank. The material shortages weighed heavily on the industry. In addition, there would be price turbulence on the energy markets. “The massive increases in gas and electricity prices are becoming an economic risk,” Gitzel warned. «The strong momentum in the service sector is likely to subside considerably. (…) The manufacturing industry is likely to continue to suffer from the delivery problems. ”

In the third quarter, for example, the hospitality industry benefited from the reversal of the corona restrictions. “The German economy continued to recover in the summer 2021,” affirmed the Bundesbank in its monthly report. “Economic activity is likely to have increased slightly more than in the spring.” The fact that supply bottlenecks for raw materials and intermediate products dampened production in the industry prevented even stronger economic growth in the period April up to and including June 2021 1.6 percent up on the previous quarter. The Federal Statistical Office plans to publish the first figures for the third quarter this Friday (29. 10.).

“Delivery problems are causing problems for companies,” said Ifo President Clemens Fuest. Capacity utilization in industry is falling. “Sand in the gears of the German economy is holding back the recovery.” The companies surveyed by the Ifo Institute rated the prospects as less favorable. The ongoing problems in the international trade in goods, most of which can be traced back to the corona pandemic, once again weighed on the mood Companies their current situation a little better than last.

In August construction companies in Germany received a comparatively large number of new orders, despite the sharp rise in construction prices. According to calculations by the Federal Statistical Office, orders were in terms of value 18, 9 percent above the level of the same month last year. Adjusted for calendar effects and price increases, there was still a real plus of 5.7 percent.

The shortage of materials continues to slow companies, said the general manager of the construction industry association, Tim-Oliver Müller. Since the orders could only be processed slowly, there was a price-adjusted sales decline of 2.9 percent in August. In nominal terms, however, revenues climbed by 6.8 percent compared to the same month last year.

The Central Association of the German Building Industry (ZDB) referred to weak base values ​​from the Corona year 2020 to explain, at least in part, the sharp rise in demand. Commercial companies in particular ordered more construction work than in the previous year, while public customers held back current situation together. “It is now important that private households do not become totally unsettled by the constant bombardment with bad news and that demand collapses as a result.”

According to KfW chief economist Fritzi Köhler-Geib, the recovery is ” just postponed »:« The order backlog in the industry is record high and private households have saved an unusually large amount of money in the pandemic. I therefore expect a strong growth spurt in the course of 2022 as soon as the supply-side distortions subside. “

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