Ifo signals a rise in construction and retail
The overall Ifo business climate suffered a setback in July. Looking at the sector-based performance, the construction and retail sector saw a rise. However, it was offset by the fall in manufacturing and wholesale. The construction index continued its rise over the past four months. It reached 5.4—a new record high. Retail rebounded from last month’s fall—it rose to 10.2. Ifo’s manufacturing business climate had a slight fall to 9.8, while the wholesale sector experienced the sharpest fall. It fell from 15.1 in June to 11.8 in the current month.
Ifo’s business expectation and situation tell a slightly different story
Looking at the sector-based analysis of the German business survey, the rise of Ifo’s business expectation was only evident in construction. All of the other sectors’ expectations took a hit—this can be attributed to the Brexit vote. Ifo’s current business situation graph indicates a rise in the retail and manufacturing industry, while the construction and wholesale situation fell.
In the manufacturing industry, the automotive sector reported pessimistic business expectations.
Impact on the European ETFs
Looking at the performance of the European ETFs, the iShares MSCI Eurozone ETF (EZU) was trading 0.09% higher on July 25. The iShares Currency Hedged MSCI Eurozone ETF (HEZU) fell by 0.12%. The broad-based Vanguard FTSE Developed Markets ETF (VEA) fell by 0.17% on July 25.