German business morale brightened | 26 Enero 2023

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German business morale brightened in January as Europe's largest economy started the new year with easing inflation and an improved outlook, a survey said. The Ifo institute said its business climate index rose to 90.2. The increase is driven by considerably less pessimistic expectations, while companies were, however, somewhat less satisfied with their current situation, Ifo said. "There probably won't be a recession, but GDP could shrink slightly in the first quarter," Ifo's economist Klaus Wohlrabe said. The reason for this resilience is not so much the structure of the economy but rather a simple policy recipe that the German government has successfully used over the last 15 years and perfected recently: fiscal stimulus.

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