German IFO business climate at two-year low

By Francisco Miñana

Date: Friday 22 Jun 2012

Germany's business confidence indicator compiled by the IFO Institute fell from 106.9 to 105.3 in June, a two-year low. The market was expecting a reading of 105.9.

Looking at the sub-components, the current assessment index rose from 113.3 to 113.9 compared to a consensus estimate of 112.3. The expectations index fell from 100.9 to 97.3 compared to the 99.8 forecasted.

IFO economist Klaus Abberger said that the debt crisis is reaching Germany and that the manufacturing climate has deteriorated strongly.

"If we also look at the preliminary Purchasing Manager Indices (PMIs) for manufacturing and services, we see that the overall German economic outlook is not very good," said analysts at Digital Look.

FM

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