German investor morale falls further on supply chain squeeze

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FRANKFURT, Germany — Confidence among investors in Germany fell again in October, figures published Tuesday showed, as global shortages of raw materials and industrial components reined in Europe’s top economy.اضافة اعلان

The ZEW institute’s monthly barometer measuring economic expectations fell 4.2 percent in October to 22.3 points, the fifth consecutive month that the indicator has gone backwards as concerns about coronavirus variants are replaced by worries over shortfalls in supply.

The outlook for the German economy has become “noticeably cloudy,” ZEW president Achim Wambach said in a statement.

The latest fall was “primarily down to continuing bottlenecks in the supply of raw materials and components,” Wambach said.

ZEW’s assessment of the current economic situation in Germany also fell by 10.3 percent to 21.6 points, having risen consistently between February and September.

The upheaval caused by the pandemic has given rise to global shortages in everything from timber to semiconductors and plastics, limiting production across the economy.

Germany’s important automotive sector has been particularly hard hit by a lack of computer chips, a key component in conventional and electric vehicles, leading carmakers including Volkswagen to scale back manufacturing.

Key German economic indicators have turned negative in recent weeks, reflecting industry-wide struggles with the supply chain issues. 

Industrial orders and production fell by 7.7 percent and four percent in August, respectively, while exports were down 1.2 percent that month.

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