Germany’s economy getting back on track?
There are signs that the biggest European Union economy is getting back on track after years of near-zero growth. Business confidence was the highest in April since 15 years. Analysts had expected a slight drop in confidence so the sudden rise came as a surprise. The strong Euro currency and high oil prices are still elements that could stall growth.
“After already rising sharply for fourth months in a row, the Ifo business climate index rose slightly again in April. This points to an ongoing robust economy,” said Ifo board member Gebhard Flaig.
For its monthly survey, Ifo polls around 7,000 companies about their assessment of current business and their expectations for the next six months.A breakdown of the data showed that the current sentiment sub-index rose to 106.4 points in April from 105.1 points in March. At the same time, the expectations sub-index slipped slightly, easing to 105.5 points from 105.7 points.
“After five years in the doldrums, Germany’s new-found cyclical momentum seems to be almost unstoppable,” said Bank of America economist Holger Schmieding.
“Neither the surge in oil prices, the nasty IG Metall wage dispute, higher interest rates nor the recent updrift in the euro exchange rate have dented German business confidence,” he said.
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Administrator @ May 1, 2006