The Ifo Business Climate Index, considered the most important barometer for the German economy, is based on about 7,000 monthly survey responses from firms in manufacturing, construction, wholesaling and retailing.
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In a written statement, the President of the Ifo Institute, Hans-Werner Sinn, claimed that this is not related to Volkswagen.
Kristian Rouz – German business confidence in October dropped less than anticipated as the impact of the VW emissions scandal to the nation’s automotive industry turned out to be insignificant.
“The German economy is proving remarkably resilient in view of this autumn’s multiple challenges”, he said, in reference to Europe’s refugee crisis and the slowdown in China.
Media reports in Germany suggest that Volkswagen is considering offering discounts on new cars for a few owners of vehicles affected by the diesel emissions scandal and recall.
But it conceded that growth in the period from July to September may not come out “quite as dynamic” as in the preceding two quarters, when it had stood at 0.3 percent and 0.4 percent respectively. We see that the index even rose in the automobile sector. “The climate index for the automotive sector even continued to rise this month”.
Last Thursday, a survey of companies by the German Chambers of Commerce (DIHK) projected the deceleration of the German economy in 2016.
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Although he did add that “exports… are not expected to provide further stimuli”. But many private sector economists and the German Chambers of Commerce, or DIHK, are less optimistic about future growth.
