German business confidence has fallen for the fourth month in a row amid growing concerns about a slower European recovery and turmoil in the Middle East and Ukraine.
The Ifo institute said Monday its closely-watched business confidence index dropped to 106.3 points in August from 108 points in July. Market analysts had expected a dip to 107.0.
The poll of some 7,000 companies showed a drop in both their assessment of their current situation and also their future expectations.
Germany's economy contracted by 0.2 percent in the second quarter of 2014, as an unusually mild winter made construction activity migrate to the first quarter. The contraction contributed to a flat reading for the overall eurozone economy.
Doubts about the future include whether the 18 countries that use the euro will resume their modest recovery. Analysts also say concerns continue to grow over the effect of the crises in Ukraine and the Middle East on Germany, a major exporter whose economy depends on global trade.
Most analysts expect Germany to return to growth in coming quarters. Economist Carsten Brzeski at ING said that companies' assessment of their current situation remains relatively high, "giving hope that the third quarter could see a rebound of economic growth."
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