German IFO Business Climate Declines to 105.3 - 22.6.2012

German IFO Business Climate fell in June to 105.3, compared to expectations of a decline to 106.1 and the previous figure in May of 106.9, the CES IFO Institute said today. The index fell to its lowest level since March 2010 due to worsening sovereign debt crisis and political tension in the euro-area last month. German economy expanded by 0.5 per cent in the first quarter of 2012, however spending cuts across European-members are reducing demand for German goods. The German IFO Business Climate is presenting two equally weighted sub-indices: the IFO Current Assessment and the IFO Business Expectation. Furthermore the IFO Current Assessment rose to 113.9 in June from a revised 113.2 in May, while the IFO Business Expectation dropped to 97.3 in June from a revised 100.8 in May. Therefore expectations for economic growth and business activity are negative and are pushing lower the IFO Business Confidence for Germany.