BERLIN (Reuters) - A slight improvement in the leading Ifo business climate index does not suggest a change of trend, the Ifo institute said on Tuesday, adding that Europe’s biggest economy is likely to shrink again in the third and stagnate in the fourth quarter.
“This is not the start of a change of trend, the slowdown is only taking a break,” Ifo’s Chief Economist Klaus Wohlrabe told Reuters, adding that no signs of improvement were to be seen for Germany’s industry, which is stuck in a recession.
The latest ECB decisions to further ease its monetary policy are unlikely to have a positive short-term impact on Germany’s economy, Wohlrabe said, adding that a recent rise in oil prices has hampered the sentiment in Germany’s chemicals industry.
The institute’s business climate index in September showed slight improvements, but expectations worsened.
Reporting by Tassilo Hummel, editing by Riham Alkousaa