MUNICH (dpa-AFX) – Hopes for lower energy prices and the effects of government investment packages have significantly boosted sentiment in the chemical industry. The relevant index from Munich’s Ifo Institute rose in June from minus 16.2 to minus 8.9 points. Expectations, in particular, improved dramatically: while they stood at minus 5.4 points a month ago, they have now jumped into positive territory at 9.5 points. According to Ifo, this is the best figure in three and a half years. However, the current business situation remains very negative, at minus 25.7 points.
“The planned reduction of electricity tax for industry is already giving the chemical sector a noticeable boost,” says industry expert Anna Wolf. The marked improvement is remarkable. In addition to the electricity tax, the planned investment package could also play a role, as chemical products will be needed here as well.
A Positive Signal for the Economy
The rise in expectations is also a positive signal for other sectors of the economy. The chemical industry is a leading indicator, says Wolf.
However, the current business situation remains bleak. Order backlogs continue to be assessed as extremely low. While demand for chemical products is stabilizing, many companies are still planning to reduce production and cut jobs.
Some companies have benefited from lower raw material costs and the first signs of a revival in demand on international markets. Nevertheless, the protectionist US tariff policy, persistently high domestic costs, and geopolitical uncertainties continue to weigh on the sector’s economic recovery. “In this situation, the government investment measures decided by the federal government are providing urgently needed impetus,” says Wolf./ruc/DP/stk
