On Germany’s avoiding recession

While Germany's numbers for Q4 2012 were poor, showing a contraction of 0.5%, I noted in my last post on Germany that this does not mean recession.  The contraction was due to export and capital investment figures, which look to rebound in Q1.
Today's German ZEW sentiment survey was much stronger than expected.  The survey jumped up to 31.5 from 6.9, while consensus estimates were only 12.0.  This figure puts  business sentiment at a 2 1/2 year high according to Brown Brothers Harriman.  BBH also notes that "it lends credence to the Bundesbank's optimism" that Germany is already recovering from the Q4 contraction. We should be looking for the PMI readings as confirmation that the sentiment index uptick has registered in terms of production. And I would also expect it to have a positive im...


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