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German business morale defies political risks

Monday, April 24, 2017 - 01:38

German business morale brightens more than expected in April, hitting its highest in nearly six years. As Ivor Bennett reports, the IFO survey suggests company executives are more upbeat about the current state of Europe's largest economy.

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Across Europe's front pages, one story dominates. But after France, it is perhaps Germany where the result of yesterday's election matters most. Because later this year, they face a similar choice - pro or anti-globalisation? But despite the various protests and sense of uncertainty, confidence in the economy is as robust as ever. The influential IFO survey showing business morale was at its highest in April in nearly six years. (SOUNDBITE) (German) IFO ECONOMIST, KLAUS WOHLRABE, SAYING: "It is the case that politics is having no effect on the German economy. The German economy seems to only react when it has concrete decisions. With Trump as with Brexit and even now with the election in France - there is an element of uncertainty but nothing has been concretely decided." The reading was much higher than analysts expected. Even though it was done before the French election. Construction was one of the main drivers - a growing population and rising employment fueling a housing boom. (SOUNDBITE) (German) IFO ECONOMIST, KLAUS WOHLRABE, SAYING: "Industry is getting more orders, exports continue to rise, the construction industry is running from record to record and consumers keep on purchasing. At the moment there are no weak points in the German economy." Some say otherwise, pointing to sluggish investment While managers' outlook for the next 6 months was also less optimistic But the news will nevertheless be a welcome boost for the German Chancellor. A strong economy vital if she's to be in the driving seat come the election in September.

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German business morale defies political risks

Monday, April 24, 2017 - 01:38