FRANKFURT (Dow Jones)--The German economy is showing signs of the early
stages of a recovery, an economist with the Ifo institute said Monday, but it
still needs help from an interest rate cut by the European Central Bank.
"Now at this stage, I would say, it's just the early stage of a recovery,"
said Gernot Nerb, an economist with the Munich-based economic institute. Still,
he said, "There's no self-sustained recovery, so there's still need for
stimulus" from interest rate cuts.
In January, the institute's index of western German business sentiment rose
to 86.3 from 84.9 in November. Due to a change in the survey schedule, the
institute didn't do a separate December survey, but calculated a December index
level of 85.8 based on the January and November data.
Because the December data weren't based on a separate survey, Nerb said he's
cautious about declaring a recovery.
"Normally you have to wait three months" to declare a recovery based on
rising survey data, Nerb said. "But December is not an authentic value, so for
that reason, I would be cautious."