German Companies Are More Cautious About Global Economic Prospects, Survey Shows
German companies are scaling back their global growth exceptions due to the pending trade conflict, according to a survey published Friday by a business group.
The findings highlight the vulnerability of Germany’s export-driven economy.
The number of those expecting the global economy to deteriorate over the next year more than doubled to 25% from 10%, according to a survey of 3,500 companies conducted by the DIHK Association of German Chambers of Industry and Commerce.
At the same time, only one in four companies expects the global economy to improve compared with 40% who shared that view in spring, the survey shows.
“One can get dizzy when looking at the current issues of trade policy,” DIHK President Eric Schweitzer said.
The only region offing a good growth outlook for German exporters was North America, the survey showed. The optimism comes as President Trump’s recent tax reform has spurred the U.S. economy.
Overall, the DIHK cut its forecast for world economic growth to 3.6% for this year from 4.0% seen earlier this year, and sees growth of 3.5% for 2019.
The more cautious export outlook has also weight on Germany’s growth outlook. The German government along with various economic institutes recently scaled back their forecasts, with the government’s council of economic experts cutting their outlook to just 1.6% for this year, from 2.3% seen previously, and to just 1.5% for 2019.
The European Commission on Thursday cut its German growth forecast to 1.7% for 2018 and to 1.8% for 2019.
Source: Dow Jones