German Business Confidence Unexpectedly Falls in October

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The Ifo institute in Munich said its business climate index has fallen to 100.0 from 101.4 in September. That is the sixth consecutive decline, as well as the lowest reading since February of 2010. Economists has predicted that the index, which is based on a survey of 7,000 German executives, would rise to 101.6 in October.

Ifo's measure of executives' expectations remained unchanged in October at 93.2, but the gauge of the current economic situation sank to 107.3 from last month's reading of 110.3.

Strong exports have helped insulate Germany from economic turmoil in the region, but the sovereign debt crisis continues to be a drag on Europe's largest economy. At least five of the 17 euro-area nations are in recession. Germany manufacturing and service industries shrank this month more than economists has forecast, another report showed today. Some experts believe the German economy will contract in the fourth quarter as eurozone and global demand for its exports continues to wane.

Filed under: 24/7 Wall St. Wire, Economy, International Markets
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