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Brexit referendum to slightly dampen German economy: research group

Xinhua, July 6, 2016 Adjust font size:

The result of the Brexit referendum will probably put a small damper on German economy in 2016 and 2017, research group Ifo institute reported said Wednesday.

According to Ifo's latest figures, economic growth in Germany will be only about 0.1 percent lower than previous forecast for 2016 and 0.1 to 0.2 percent lower for 2017, due to weaker exports and investments.

"This is a small effect. It will not endanger the upswing that the German economy has been experiencing for over three years now," Timo Wollmershaeuser, interim director of the Ifo Center for Business Cycle Analysis and Surveys, said.

"We expect an economic downturn in Britain, a depreciation of the British pound, as well as a temporary period of higher uncertainty. That will have a small negative impact on German exports and investments, but this will be short-lived," Wollmershaeuser added.

The Munich-based think tank noted that its calculations do not take into account the longer-term, conceivable effects of a Brexit.

The Ifo business climate index is considered the most important barometer for the German economy. Enditem