The German economy is probably not going to its knees from the development around the corona virus. The Ifo business climate index is considered an important mood barometer and it is rising - although experts have expected exactly the opposite.
Munich (dpa) - Despite the spread of the corona virus, the mood in the German economy surprisingly brightened somewhat in February.
As reported by the Munich Ifo Institute, the business climate it raised rose by 0.1 points to 96.1 points. Analysts had expected a drop to 95.3 points. "The German economy appears to be unaffected by the development surrounding the corona virus," commented Ifo President Clemens Fuest.
The business climate was supported by improved expectations for the next six months. The corresponding sub-indicator rose from 92.9 to 93.4 points. However, the companies assess their current business situation somewhat more skeptically than recently. The indicator dropped by 0.3 points to 98.9 points.
Economists are warning of too much optimism given the rapid spread of the corona virus. "Perhaps today's figure is just a look in the rear-view mirror and doesn't tell us too much about the close economic prospects," commented Uwe Burkert, chief economist at Landesbank Baden-Württemberg.
"With the current spread of the corona virus in Italy, we may have a completely new situation." Burkert referred to the weak development on the financial markets on Monday. This shows how much fear is suddenly in the financial markets.
According to Commerzbank chief economist Jörg Krämer, the corona virus should prolong the industrial recession in Germany by "a few months". He referred to the massive loss of production in China. "It is quite possible that this will cause the German gross domestic product to shrink in the first quarter due to falling exports and a lack of deliveries - especially since the virus has reached northern Italy," says Krämer.
The Ifo data did not change the gloomy mood on the financial markets. The euro only rose shortly after the data was published and quickly came under pressure again. The stock markets remained under pressure even after the data. German government bonds, which are considered to be safe, were significantly up.