According to a survey by management consultancy Deloitte, industry in particular assesses the economic prospects as worse. Only the service providers set different accents.
According to a survey by management consultancy Deloitte, German CFOs are more pessimistic about their business prospects. The difference between positive and negative assessments fell from plus 9 percent in the spring to minus 17 percent in the fall.
185 CFOs of large German companies took part in the survey between September 12th and October 2nd. The crisis is particularly felt by the German core industries of automobiles, chemicals and mechanical engineering. The consumer goods industry and retailers also assessed their business prospects negatively.
According to the survey, companies in the automotive and chemical industries want to reduce investments and cut jobs. The service sector, on the other hand, plans to invest more and hire workers. On average, investment and employment plans for all sectors are stagnating in slightly negative territory.
Further interest rate cuts and 2.8 percent inflation expected
Service providers are still benefiting from catch-up effects after the corona pandemic or from the change in interest rates, says Deloitte chief economist Alexander Börsch. “However, if the division in the German economy continues to deepen, the service sector will not be able to compensate for weakening industry in the long term.”
The CFOs cite weak domestic demand, increasing regulation and geopolitical risks as major risks. But they expect inflation to fall to 2.8 percent in the next twelve months. This and further interest rate cuts are likely to boost consumption and investment, says Börsch. The conditions for a consumption-driven recovery are intact.
Source: Stern
