German business confidence continues to retreat in September

The German analysts and investors have kept their negative mood in September, according to the latest data from the Center for European Economic Research ZEW. The German business confidence continues to retreat in September. The positive attitudes of the business gave for the ninth consecutive month amid the expected response from Russia in response to the latest round of sanctions imposed by the European Union (EU) on September 12th. The indicator based on expectations for the coming six months about 350 respondents from European largest economy, dropped to 6.9 points in September compared with 8.6 points in August. The market consensus had set a score of 5 points.

The reached level proved to be the lowest until December 2012, when the index also registered 6.9 points. The index of current conditions even sank to 25.4 points from 44.3 in August, according to a survey by Mannheim-based think tank. Analysts predicted level of 40 points in September.

“Trust business continues to weaken, prompted in part by fears of the Ukrainian crisis and fears of a rise in political instability elsewhere in the euro area, especially in France”, stressed analysts at Capital Economics before the presentation of the data.

Nevertheless German leaders remain strongly opposed to softening the strict rules of economic policy. German Finance Minister Wolfgang Schaeuble said in a speech last week that it is wrong to believe that the loosening of budgetary rules within the European Union will help spur economic growth and jobs in the region.

“The calls in Europe to use more and more public money through the adoption of higher and higher deficits and debts are misleading”, said Schaeuble front of the lower house of parliament in the discussion of the federal budget for next year. “In recent years we have proved time and again that sound fiscal policy is the best policy for growth and jobs. Everyone should adhere to the rules compiled together”, he added