Germany: Business confidence deteriorates further in November
The ifo Business Climate Index fell from 97.7 in October to 96.5 in November, with the index consequently dropping further below the 100-threshold that separates pessimism from optimism among firms.
The deterioration came on the back of more downbeat views on the current situation as well as expectations. Supply bottlenecks and the fourth wave of Covid-19 were chiefly behind this.
Carsten Brzeski, global head of macro at ING, added:
“For the entire economy, the combination of supply chain frictions, higher energy prices and higher inflation in general already argued in favour of a significant slowdown of economic activity in the final quarter of the year. The fourth wave of the pandemic could now actually push the economy to the brink of stagnation, or even technical recession. Admittedly, the adaptability of the economy to lockdowns, supported by government and central bank measures, has clearly increased since March 2020.”