Germany’s economy faces deep depression
In September, the Ifo business climate index fell for the fourth time in a row. It now stands at just 85.4 points. The value 100 represents the index in 2015. This measures the economic outlook in companies.
The negative mood has now spread to almost all sectors. In addition, entrepreneurs are assessing expectations even more negatively than before. "Germany is facing dramatic months ahead," commented Die Welt on the slump.
Daniel Hartmann, chief economist at the investment company Bantleon, says: "In view of the weak German economic data, the question arises as to whether this will lead to a new downward spiral that will plunge Germany into a deep recession." This cannot be ruled out, especially "if the slump in the automotive sector worsens further and spreads to other sectors."
Is Trump worsening Germany’s economic crisis?
Many experts also fear that the crisis will worsen if import tariffs are significantly higher after the presidential elections in the USA in six weeks. This was announced by Republican candidate Donald Trump. According to the Ifo Institute, German exports to America would then fall by a further 15 percent.
This could set in motion a spiral of counter-tariffs from China, for example, which would threaten the existence of Germany as an export nation, it is said. That would be far worse than the current, never-ending recession. Exports would collapse dramatically. This has not yet been factored into the business climate index.
The only silver lining on the horizon is the construction industry, which is currently in a state of total collapse. The mood there has improved slightly. But that doesn't really give us hope. Because: "From the ground level, things can only go up," said Martin Moryson, chief European economist at DWS, commenting on the phenomenon.
Source: Junge Freiheit
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