• German IFO Business Climate Index continued to decline in January.
• IFO Current Economic Assessment fell to 87.0 in the reported month.

The headline German IFO Business Climate Index declined to 85.2 in January from 86.3 in December. Markets were expecting this figure to improve slightly to 86.7.

Meanwhile, the Current Economic Assessment Index came in at 87.0 in the same period, below the December print and the market expectation of 88.5 and 88.6, respectively.

Finally, the IFO Expectations Index – indicating firms’ projections for the next six months, edged lower to 83.5 from 84.8.

Market reaction to the German IFO Survey

EUR/USD showed no immediate reaction to these data disappointing sentiment data and was last seen moving sideways at around 1.0900.

About German IFO

The headline IFO business climate index was rebased and recalibrated in April after the IFO Research Institute changed the series from the base year of 2000 to the base year of 2005 as of May 2011 and then changed series to include services as of April 2018. The survey now includes 9,000 monthly survey responses from firms in the manufacturing, service sector, trade and construction.