German business sentiment deteriorated sharply at the start of the year, with manufacturers and construction firms turning more pessimistic on the outlook for their businesses, the Ifo Institute in Munich said Monday.
“The year started with an unpleasant surprise for the German economy,” said Hans-Werner Sinn, the Ifo Institute’s president.
The Ifo’s business climate index fell to 107.3 in January from a downwardly revised 108.6 in December last year, its lowest level since February 2015. Economists polled by The Wall Street Journal had forecast a much smaller decline to 108.5.
The mood among German manufacturing companies hit a 12-month low, the Ifo Institute said.