German business confidence in December plunged to a 16-year low as export demand continued to shrink amidst the global financial turmoil, according to a monthly survey published Thursday.
The business climate index, calculated by the Ifo Institute for Economic Research, fell to 82.6 in December from November's 85.8, the lowest since late 1982.
The dominant feature of the December decline was the worsening of the firms' current business situation, falling from 94.9 in November to 88.8 in December, the Munich-based Ifo Institute reported.
With regard to the six-month business outlook, the poll said, the skepticism of those surveyed remained nearly unchanged, from 77.6 in November to 76.8 in December.
The German economy has experienced a tough winter, Germany's central bank Bundesbank said Monday. It forecast that the economy would shrink 0.8 percent in 2009.
The GDP may contract as much as 3 percent next year, a post-World War II record, the Economy Ministry said Tuesday.
German Chancellor Angela Merkel said Tuesday her government will adopt more stimulus measures to cushion the country's economy.
The European Central Bank is expected to lower its deposit rate to 2 percent as soon as Thursday in an effort to jolt banks into lending more to each other.
The Ifo Business Climate Index is based on responses from about 7,000 firms in manufacturing, construction, wholesaling and retailing.
Source: Xinhua
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