Germany’s economy is on the brink of recession after business confidence plunged to its lowest level in seven years.
The ifo Institute, a Munich-based research group, said: “Worry lines among German business leaders are getting deeper and deeper.” Its monthly confidence index fell to just 94.3 points in August, down from 95.8 in July, the weakest reading since November 2012.
In the latest sign that Europe’s largest economy is struggling, the survey of nearly 10,000 German companies found that managers were gloomier about the current economic situation, and more pessimistic about the outlook over the next six months.
The head of ifo, Prof Clemens Fuest, forecasted that Germany’s GDP would shrink this quarter, having already contracted by 0.1% in the previous three months. That would put the economy into a recession for the first time since 2013.
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