Record cancellations of residential projects in Germany due to rising interest rates

The Institute for Economic Research (Ifo), one of Germany's leading economic think tanks, has published the results of its August survey of construction firms' plans.

Accordingly, 20.7 percent of companies reported that their projects had been cancelled in August. This compares with 18.9% in July.

Due to rapidly rising construction costs and significantly higher interest rates, many projects that were still profitable at the beginning of 2022 are now no longer economically viable, the Ifo said in a statement.

According to the survey, while some companies' order books are still full, 44.2 per cent said they were already experiencing a lack of orders. This compares with 13.8% a year ago.