German business climate down, as economy lacks momentum

A closely watched index of German business optimism has fallen for the second month in a row as the mood among company managers in Europe's largest economy weakened further.

The Munich-based Ifo institute said Thursday its business climate index slipped to 97.9 points in May from 99.2 in April.

The drop was driven by a considerably worse assessment of the current business situation, which dropped to 100.6 from 103.4 the previous month. Expectations for the next six months, however, remained unchanged at 95.3.

Despite some recent positive signs, Ifo says the poll indicates "the German economy is still lacking in momentum."

The survey is based on some 9,000 responses from firms in manufacturing, the service sector, trade and construction.