Germany: Business confidence plunges to lowest level in almost three years
September 24, 2012
Despite the recent pledge from the European Central Bank to support debt-stressed countries, businesses remain skeptical about the economic impact of the move. Accordingly, the business confidence indicator published by the Ifo Institute fell to 101.4 points in September, which marked the fifth consecutive decline and drove the index to its lowest level since February 2010. The reading came in below the 102.3 points observed in August and disappointed market analysts, who had seen the index rising to 102.5 points. The monthly drop reflected that firms are less optimistic about their current business situation. Simultaneously, the September survey showed businesses' more pessimistic assessment of their economic prospects for the next six-months. According to the Ifo Institute, "the curbing forces on the German economy continue to prevail".
Author: Ricardo Aceves, Senior Economist