Germany turning the corner

The Eurozone is coming back to life with Germany leading the way. The Ifo business climate headline index remains strong, surprising on the upside against market expectations of a decline in March, signalling resilient growth in the region.

Current Ifo data released (107.7) is close to the all time high of December last year (108.7). The Munich-based Ifo sentiment index suggests that Europe’s largest economy has been resilient in the face of a U.S. slowdown and overcome the sales tax increase.

Roger Guy, Manager of the Gartmore European Selected Opportunities Fund and the Gartmore SICAV Continental European Fund comments, “Empirical evidence points to encouraging growth prospects in Germany. In particular, a maturing cycle and improving labour market is likely to place more emphasis on the consumer to be the driver of activity and revive consumption. German expansion appears to be on the path of acceleration as companies step up hiring and investment. All these factors will contribute towards boosting consumer confidence.”