In a day of negative data for the entire Eurozone, it doesn't even save the Germany. German business sentiment fell for sixth consecutive month in October. The decline is higher than even the worst forecasts and indicates that the euro zone crisis is also affecting the continent's largest economy. The Ifo index, based on the consultation of 7 companies, dropped to 100 points, from 101,4 in September.
As for thePMI index on manufacturing and services, Germany files the sixth consecutive month of contraction. The data worsens compared to September (by 49,2 to 48,1), with a thinner order book and weaker export demand. At this point, it is likely that Europe's largest economy could enter a recession in the second half of this year.
In detail, the flash estimate on the Markit Purchasing Managers Index records for the manufacturing sector a drop to 45,7 points, from 47,4 in September. Expectations were for a rise to 48. The sub-index relating to new orders fell to 41,0 from 42,4.
Il service sector – which economists had expected to return to an expansionary level with a reading of 50,0 – scored 49,3 points, from 49,7 in September.
