Gloom settles in over Germany’s economy as businesses remain downbeat about coming months WSOC TV [Video]

FRANKFURT, Germany — (AP) — Germany’s businesses remain mired in pessimism, a key survey showed Friday, as Europe’s largest economy struggles with shortages of skilled labor, slower global trade, high interest rates and political squabbling.

The closely watched Ifo institute survey of business sentiment rose only slightly to 85.5 points in February from 85.2 points in January due to “slightly less pessimistic expectations,” the institute said in an accompanying statement.

“The German economy is stabilizing at a low level,” the institute said.

The survey results follow a sharp downgrade of the government’s expectations for growth this year, to only 0.2%, from 1.3% in the previous forecast. Germany’s economy shrank 0.3% in 2023, the worst performance by a major economy and a reversal of years of economic success as an export champion.

Germany faces a combination of temporary and long-term headwinds. A burst of inflation after Russia cut off natural gas supplies over the war in Ukraine robbed consumers of spending power. While inflation has since eased …