The German business sentiment index went up in February from the previous month’s 95.9 to 96.1, going against the analyst’s expectations who foresaw that the index was going to fall to 95.3.
The report, released by the IFO research Institute, also states that the Current Economic Assessment was at 98.9 points in February, going down from the previous month’s 99.1 but beating up the analyst’s forecasts, who foresaw it at 98.6. The expectations index, which measures the investors’ expectations for the next six months, was at 93.4 on February, going up from January’s 92.9 and beating up the analyst’s expectations, who foresaw it to fall to 92.2.
“Sentiment among German managers has improved somewhat,” explained IFO on its report, “Although companies assessed their current situation as a little worse, they are less pessimistic about the next six months,” they added.
Regarding the Coronavirus outbreak, they claimed that it seems that the German economy is not being affected by it.
“The German economy seems unaffected by developments surrounding the coronavirus,” they said, adding that given the current data the economy is expected to grow 0.2 percent during the first quarter.
For the manufacturing sector, the index went up for the third consecutive month. On the other hand, the services, trade and construction sectors indexed declined.
Tomorrow the German gross domestic product figures for the fourth quarter of last year is expected to be released by the German statistics office. Markets expect it to be at 0.4 percent, leaving the yearly figure at 0.3 percent.
By 9:45 GMT the Euro went down against the US dollar, losing 0.20 percent and falling to the 1.0821 level. Conversely, it dropped 0.39 percent against the Japanese Yen, at 120.47. On the other hand, it climbed 0.04 percent against the Swiss Franc, hitting the 1.0608 level.
The United States Treasury Secretary Steven Mnuchin told reporters that the US doesn’t expect the coronavirus epidemic to have an effect on phase 1 of the trade deal.
“I don’t expect that this will have any ramifications on Phase 1. Based on everything that we know, and where the virus is now, I don’t expect that it’s going to be material,” he explained, “Obviously that could change as the situation develops. Within the next few more weeks, we’ll all have a better assessment as there’s more data around the rate of the virus spreading,” he added.
Mnuchin also acknowledged that the outbreak may delay reaching a phase 2 of the trade deal, however, he highlighted that the government doesn’t feel any pressure to reach a deal before the November elections.
“If we get the right deal before the election, that’s great. If we get the right deal after the election, that’s great. We don’t feel any pressure one way or another,” he said.
By 10:09 GMT the US dollar went up by 0.04 percent against the Chinese Yuan, hitting the 7.0289 level.