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German business morale falls less than expected in September

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German business morale falls less than expected in September
FILE PHOTO: A container ship is seen at the shipping terminal Eurokai in the Port of Hamburg, Germany November 6, 2017. REUTERS/Fabian Bimmer/File Photo   -   Copyright  Fabian Bimmer(Reuters)
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BERLIN (Reuters) – German business morale deteriorated less than expected in September, a survey showed on Monday, suggesting that company executives have become somewhat less confident about the growth outlook of Europe’s biggest economy.

The Munich-based Ifo economic institute said its business climate index fell to 103.7 from a revised 103.9 the month before. That beat a Reuters consensus forecast of 103.2.

“Despite growing uncertainty, the German economy remains robust,” said Ifo chief Clemens Fuest.

Managers assessed their current business situation a bit less favourable, but that sub-index remained at an overall high level. Companies also scaled back their business expectations marginally.

The main drag came from weaker business morale in manufacturing. Sentiment improved in retailing and services.

In construction, business sentiment reached another record high. “Contractors reported a steady stream of incoming orders,” Ifo said in a statement.

Economy Minister Peter Altmaier has said the economy is likely to grow around 2 percent this year. That would be less than both the government’s forecast of 2.3 percent and the calendar-adjusted growth rate of 2.5 percent reached last year.

Germany’s growth outlook is clouded by an escalation of the trade dispute between the United States and China as well as the unclear outcome of Britain’s negotiations with the European Union about its departure.

(Reporting by Michael Nienaber; editing by Joseph Nasr, Larry King)

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