bvdm economic telegram February 2023: Positive trend in business climate continues

In February 2022, the decision-makers at print and media companies surveyed by the ifo Institute assessed their current business situation as significantly better than in the previous month. However, slightly falling expectations regarding business development over the next six months somewhat curbed the positive development of the business climate. The values for the business climate therefore increased less markedly. The development of the business climate, which is a good leading indicator for the production development of the print and media industry, is determined by the characteristics of the current and expected business situation.

In February, the seasonally adjusted business situation index continued the positive development of January and increased by around 5.9 percent compared to the previous month. The index stood at around 97.5 points, but remained around 2.0 percent below the figures for the same month last year. Around 16.3 percent of the business leaders surveyed assessed the current business situation positively, while around 67.1 percent were neutral and 16.6 percent negative. Despite a positive trend, the below-average order situation continues to be the defining issue for many print and media companies. In February, around 43.8 percent of respondents rated their company's current order backlog as "too low". Only around 2.8 percent rated the order backlog as "relatively large", while around 53.3 percent said it was "sufficient". On balance, this results in a value of -41 percentage points. Although this is around 26 percentage points below the figure for the same month last year, it still describes the most positive value since September 2022.

The expectations of companies in the print and media sector regarding the future business situation declined somewhat in February 2023. At a seasonally adjusted 89.1 points, the index was around 3.7 percent below the level at the start of 2023. In a year-on-year comparison, the index of business prospects for the next 6 months was around 14.2 percent below the values recorded in February 2022. Around 26.4 percent of respondents said they assessed the future business situation as "rather unfavorable," around 62.4 percent assumed that the business situation would remain the same and around 11.1 percent assessed the future business situation as "rather more favorable." However, this must be viewed in the context of the statistical basis. The good business outlook at the beginning of the previous year, with a survey date before the start of the Ukraine war, distorts the previous year's view downwards. Compared with 2022 as a whole, the index in February 2023 is around 1.8 percent higher than the annual average for 2022.