Volkswagen, the world's biggest carmaker, said it is closing European operations due to Covid-19.
- Initial March numbers show biggest drop in nearly two decades
- Ifo releases preliminary data for first time in 70 years
- Final report for this month due 25 March
Frankfurt, 19 March 2020 (LS NEWS) – German business confidence has collapsed to its lowest level since August 2009 as companies and countries around the world continue to shut down.
This month's initial estimate of headline business climate from the Ifo institute dropped to 87.7 from 96.0, its biggest decline since 1991.
No market forecast for the data was available because Ifo only announced on Wednesday that it would provide preliminary numbers for this month in what was said to be the first report of its kind in the thinktank’s 70-year history.
Ifo's forward-looking expectations component nosedived to 82.0 from 93.2, but the current assessment showed less of a slide with a fall to 93.8 from 99.0.
The report comes just two days after German investor confidence recorded its largest-ever decline.
Ifo says German 2020 GDP could plummet 6.0pct
“Fighting the coronavirus is pushing Germany into recession,” Ifo explained. The thinktank slashed its growth estimates for Europe’s biggest economy this year: one scenario sees a contraction of 1.5pct while another predicts 6.0pct.
Timo Wollmershäuser, Ifo’s head forecaster, said: “There are no comparable events in history from which we might derive probable courses the crisis could take. Besides, very few economic indicators are currently available that would allow us to estimate the overall extent of the economic consequences of the coronavirus crisis.
“Most indicators currently available reflect at best the situation in February. However, the historic crash of the ifo business climate in March indicates that the economic downturn in the second quarter will exceed all previous downturns.”
Ifo said Thursday’s data is based on the completion of 90pct of this month’s survey, which was conducted from 2-18 March. This means respondents missed the announcement from the European Central Bank overnight of a whopping EUR 750bln asset purchasing programme to compliment previous QE in an ongoing effort to soften the economic impact of the coronavirus.
Ifo said it will release final data for this month on 25 March.
ING Chief German Economist Carsten Brzeski said, “In case anyone had not realised it yet, all European economies are going through an unprecedented turnaround within one month; from hopes for a rebound to complete standstill.
“Today’s Ifo index, as well as other sentiment indicators in the coming weeks and months, are nothing more than a snapshot, giving some idea of the size of the economic plunge without being able to give the full picture. Also, they won’t say anything about the future.”
- Initial March numbers show biggest drop in nearly two decades
- Ifo releases preliminary data for first time in 70 years
- Final report for this month due 25 March
Frankfurt, 19 March 2020 (LS NEWS) – German business confidence has collapsed to its lowest level since August 2009 as companies and countries around the world continue to shut down.
This month's initial estimate of headline business climate from the Ifo institute dropped to 87.7 from 96.0, its biggest decline since 1991.
No market forecast for the data was available because Ifo only announced on Wednesday that it would provide preliminary numbers for this month in what was said to be the first report of its kind in the thinktank’s 70-year history.
Ifo's forward-looking expectations component nosedived to 82.0 from 93.2, but the current assessment showed less of a slide with a fall to 93.8 from 99.0.
The report comes just two days after German investor confidence recorded its largest-ever decline.
Ifo says German 2020 GDP could plummet 6.0pct
“Fighting the coronavirus is pushing Germany into recession,” Ifo explained. The thinktank slashed its growth estimates for Europe’s biggest economy this year: one scenario sees a contraction of 1.5pct while another predicts 6.0pct.
Timo Wollmershäuser, Ifo’s head forecaster, said: “There are no comparable events in history from which we might derive probable courses the crisis could take. Besides, very few economic indicators are currently available that would allow us to estimate the overall extent of the economic consequences of the coronavirus crisis.
“Most indicators currently available reflect at best the situation in February. However, the historic crash of the ifo business climate in March indicates that the economic downturn in the second quarter will exceed all previous downturns.”
Ifo said Thursday’s data is based on the completion of 90pct of this month’s survey, which was conducted from 2-18 March. This means respondents missed the announcement from the European Central Bank overnight of a whopping EUR 750bln asset purchasing programme to compliment previous QE in an ongoing effort to soften the economic impact of the coronavirus.
Ifo said it will release final data for this month on 25 March.
ING Chief German Economist Carsten Brzeski said, “In case anyone had not realised it yet, all European economies are going through an unprecedented turnaround within one month; from hopes for a rebound to complete standstill.
“Today’s Ifo index, as well as other sentiment indicators in the coming weeks and months, are nothing more than a snapshot, giving some idea of the size of the economic plunge without being able to give the full picture. Also, they won’t say anything about the future.”
--- Eric Culp, European Editor
@EricCulpLS