AFP, Frankfurt :
A closely-watched survey of German businesses showed falling confidence Thursday, the Munich-based Ifo institute said, as the eurozone’s largest economy faces gathering clouds over the single currency area.
The monthly barometer shed 0.9 points in October compared with last month, to 102.8 points, the poll found – a sharper drop than expected by analysts surveyed by Factset.
“Firms were less satisfied with their current business situation and less optimistic about the months ahead,” Ifo president Clemens Fuest said.
“Growing global uncertainty is increasingly taking its toll on the German economy.”
With exports far outweighing imports, Germany has since last year been a favourite whipping-boy for US President Donald Trump as he threatened tariffs against imports from the whole European Union.
Those are on ice for now, but the other front in Washington’s trade war –
China – is also having knock-on effects on Europe and Germany.
Disruption in emerging markets like Turkey, an important trade partner, is also taking its toll.
Closer to home, fears are growing that Britain could leave the EU in March without an exit deal, sparking massive disruption to trade with one of the continent’s biggest economies.
A budget row between Brussels and the populist coalition government in Rome has meanwhile revived anxiety over Italy’s place in the eurozone.
Lower confidence “is not surprising, as downside risks did not diminish” in October, said Joerg Zeuner, chief economist at public investment bank KfW, highlighting the US-China confrontation as well as weaker hard economic data in Germany.
The headwinds for the eurozone powerhouse prompted the International Monetary Fund earlier this month to lower its growth forecasts for Germany to 1.9 percent in both 2018 and 2019.
A closely-watched survey of German businesses showed falling confidence Thursday, the Munich-based Ifo institute said, as the eurozone’s largest economy faces gathering clouds over the single currency area.
The monthly barometer shed 0.9 points in October compared with last month, to 102.8 points, the poll found – a sharper drop than expected by analysts surveyed by Factset.
“Firms were less satisfied with their current business situation and less optimistic about the months ahead,” Ifo president Clemens Fuest said.
“Growing global uncertainty is increasingly taking its toll on the German economy.”
With exports far outweighing imports, Germany has since last year been a favourite whipping-boy for US President Donald Trump as he threatened tariffs against imports from the whole European Union.
Those are on ice for now, but the other front in Washington’s trade war –
China – is also having knock-on effects on Europe and Germany.
Disruption in emerging markets like Turkey, an important trade partner, is also taking its toll.
Closer to home, fears are growing that Britain could leave the EU in March without an exit deal, sparking massive disruption to trade with one of the continent’s biggest economies.
A budget row between Brussels and the populist coalition government in Rome has meanwhile revived anxiety over Italy’s place in the eurozone.
Lower confidence “is not surprising, as downside risks did not diminish” in October, said Joerg Zeuner, chief economist at public investment bank KfW, highlighting the US-China confrontation as well as weaker hard economic data in Germany.
The headwinds for the eurozone powerhouse prompted the International Monetary Fund earlier this month to lower its growth forecasts for Germany to 1.9 percent in both 2018 and 2019.
