Much better than forecast of -50.0, and giving the euro a boost towards 1.2800

Current conditions index 28.4 in Jan from 26.8 in Dec

  • ECB liquidity, affordable refinancing may have led to the strong month improvement
  • Asseessment gives reason for some cautious optimism
  • Points to stabilization of German economic activity in next 6 months
  • Majority of analysts expect decrease in short term interest rates
  • Inflation expectations fall again despite better growth expectations
  • S&P downgrade was expected by analysts
  • Q4 saw sharp decrease, more or less stagnation in H1 of 2012, chance of a mild recession