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German business confidence falls again in February: Ifo
[FRANKFURT] German business confidence fell for the third consecutive month in February, with manufacturers reporting the biggest drop in confidence since November 2008, the Ifo economic institute said Tuesday.
The institute's closely-watched business climate index slumped to a level not seen since January 2015, reaching 105.7 points in February from 107.3 points in the previous month, Ifo said in a statement.
"The majority of companies were pessimistic about their business outlook for the first time in over six months," said Ifo, with manufacturers in particular voicing deep concerns.
"Manufacturers' business expectations declined steeply, marking their largest downswing since November 2008," Ifo said.
"With production levels falling at the end of 2015, manufacturers fear that the downturn will continue," it added.
Official data had shown production declining in December as domestic and eurozone demand for German-made goods fell.
But analysts said the latest Ifo reading showed that Germany's powerful export industry was starting to wake up to a global concerns roiling international markets.
ING's Carsten Brzeski said the data showed that "global events have finally reached German companies' boardrooms".
"Expectations have taken another sharp hit from recent market turmoil, the adverse impact of low oil prices and renewed concerns about a slowing of the Chinese economy," he said.
Jennifer McKeown, senior European economist at Capital Economics also noted that the sharp fall in the manufacturing index suggests that "softer global demand and the slight appreciation of the euro may be taking a toll on exports".