The camp of the economy pessimists in the German economy gets growing support for the Ukraine crisis. The mood in the head clouded days in August for the fourth month in a row and is now as bad as for over a year not more. The Ifo business climate index fell by 1.7 points to 106.3, as the Munich-based Ifo institute said on Monday in his survey of 7000 managers. Economists had only expected a decline to 107 meters. “The German economy continues to lose power,” Ifo President Hans-Werner Sinn.
damper also said in wholesale, retail and service enterprises
The managers estimated both the current business situation and the outlook for the next six months as a bad last. The barometer of the situation fell by 1.8 to 111.1 meters, the expectations for the 1.7 to 101.7 meters. Especially in industry, it is no longer running around: Here the business climate is so bad as since July 2013 no more. “From export are expected fewer pulses,” said sense. Also in the wholesale, retail and service enterprises, the mood became turbid. Only the brewing industry was able to escape the downward trend.
concerns about trade war with Russia
The fear of a trade war with Russia charged to the exporters. German exports there had collapsed in the first half to 15.5 percent, which the company cost around three billion euros. Because of the Russian action in Ukraine, the mutual sanctions were tightened in July again. “The German economy remains vulnerable to external disturbances,” said Nordea economist Holger Sandte. “Especially on the industry weigh the ongoing weakness in the euro area and the uncertainty due to geopolitical tensions.” Alexander Krüger Bankhaus Lampe sees more than a small steamer mood: “You can now say definitively ‘good mood Goodbye’”
The German economy shrank unexpectedly in the spring by 0.2 percent.. With the further decline of the most important German economic barometer chances dwindle to a strong comeback in the second half. Ifo expert Klaus Rabe well expect a growth close to zero for the current quarter. His institute will probably correct the growth forecast for 2014 from its current 2.0 toward 1.5 percent.
Economists: Turnaround in the mood Development
After three changes in a direction economists talk of a possible turnaround in the mood development. Experts had expected a further step backwards, but with about a less significant drop. As before, the index holds but at a relatively high level. The Ifo index for March 2010 is already above the mark of 100 points. The Ifo index is calculated monthly by the survey of about 7,000 companies
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