Businesses in Germany are not feeling the love. Once again we are seeing a rather significant divergence between economic and market trends. Most of that is attributable to the strong rhetoric coming from every central bank around the world that have been propping up markets with all sorts of pledges. In other words, the trend is your friend even if the central banker is a pranker.
German business confidence fell for a fourth straight month in August as the sovereign debt crisis curbed growth in Europe’s largest economy. The IFO institute in Munich said its business climate index, based on a survey of 7,000 executives, dropped to 102.3 from 103.2 in July. That’s the lowest reading since March 2010. Economists predicted a decline to 102.7, according to the median of 37 forecasts in a Bloomberg News survey.