Business sentiment dropped in Germany for the seventh month in a row to a record low point of 82.6 points in December, the key Ifo index showed today.
The monthly business climate index calculated by Munich-based economic research institute Ifo fell in December from 85.8 points in the previous month. The previous all-time low of 84.8 points had been set in February 1993.
Analysts had expected the business sentiment indicator to fall to 84.1 points.
A sub-index of the Ifo survey, that measures the current situation in Germany, was also lower at 88.8 points. This compared with 94.9 in October.
Expectations for the next six months also dropped to a record low of 76.8 points from 77.6 points, the institute said. Analysts had forecast levels of 91.7 and 77.2 points, respectively.
Earlier this week, a euro zone purchasing managers' index (PMI) for December fell to 38.3 points, its lowest level in the survey's 10-year history. The fall marked the seventh consecutive month of contraction in private sector output, which is indicated by a reading of less than 50 points.
In Germany, the world's leading exporter, the car and chemical sectors have been especially hard hit by the global economic slowdown, throwing it and the euro zone into a recession that is likely to last well into 2009.
Deputy economy minister Walther Otremba said yesterday that Germany might see economic activity contract by up to 3% next year, which would mark the worst recession in its post-war history.
