Germany In For A Cold, Dark Winter As Business Confidence Falls

By Agence France-Presse The German economy looks to be in for a cold, dark winter after business confidence fell to its lowest level since January, data showed on Dec. 18. Indeed, Ifo, the Munich-based economics research institute, found that the barometer fell for the seventh month in a row to 87.1 points in December, its lowest level since the 86.7 points recorded in January. Ifo calculates a monthly business climate index based on a survey of more than 7,000 companies about their current business and their expectations for the next six months. According to Ifo, the main reason for the decline was that companies are still feeling uncomfortable about their current business -- that particular component of the Ifo survey dropped by 2.2 points to 76.8 points in December, its lowest level since January. Ifo President Hans-Werner Sinn said the weakness was seen primarily in the wholesale and retail sectors, indicating that Christmas sales so far have been disappointing. "Companies seem to be taking heart from the stabilization of currently negative factors," Sinn said. "For example, share prices have not fallen further and the latest data in the U.S. give cause for hope of an upturn there." Copyright Agence France-Presse, 2002