BERLIN (AP) — A closely watched survey released Monday showed a larger-than-expected fall in German business confidence this month, with managers' assessment of the outlook for the next six months darkening amid recent turmoil on markets and concerns over growth in China.

The Ifo institute said its monthly confidence index dropped to 107.3 points in January from 108.6 in December. Economists had forecast that it would slip to 108.4.

The decline to the lowest level since last February was led by a drop in expectations for the next half-year. Managers' assessment of the current situation slipped only slightly.

"The year started with an unpleasant surprise for the German economy," Europe's biggest, Ifo president Hans-Werner Sinn said in a statement. He said that the chemical sector benefited from low oil prices but sentiment was weaker in several other industries, including mechanical engineering and the auto business, largely because of a poorer export outlook.

Ifo's index is based on responses from about 7,000 companies in Germany.

The German economy grew by 1.7 percent in 2015, a slight improvement over the previous year that was fueled mainly by domestic demand.