Pessimism Rife Among German Managers

Business confidence in the euro zone's largest economy hit a nine-month low this month, a new poll showed on Friday. The widely watched business climate index calculated by the Ifo think tank in Munich hit its lowest level since September 2003. The confidence barometer sank to 94.6 points in June, compared to a three-year high of 97.5 points at the beginning of 2004, and has been sliding since the beginning of the year. The results came as a surprise to most analysts, who had been expecting the index to show modest gains this month. Another key index calculated by sister economic think tank ZEW had shown earlier this week that financial analysts and institutional investors were feeling happier about the growth outlook. Ifo's business climate index surveys around 7,000 companies on their assessment of current business and their expectations for the next six months.