Those two mighty economies of the ’80s, who caught a cold, which turned into pneumonia in the ’90s, leaving them coughing and spluttering their way into the new millennium, might at last be clawing their way back.
In Germany, economic growth has been steady. Figures released earlier this week showed that the economy grew at 0.6% in the third quarter. At the same time business confidence is apparently close to its highest level since January 2001.
The Ifo business confidence index actually fell slightly in November, but that was due to an unusually good performance in October which saw the index hit its highest level. Despite the November fall, October was the second best month for the index in over 50 months.
Now, the prognosis is for a continuation of a “moderate” recovery.
Meanwhile analysts in the economy of the rising sun were celebrating a possible return of inflation. That might seem an odd thing to be so happy about but in Japan, falling prices have been the curse of the economy for a long time.
Actually it’s not quite that clear cut. The core consumer price index was at the same level as the month before, but CPI inflation after taking into account food prices did actually fall. Even so it’s the first time the consumer price index has been unchanged for five months, and the signs are that this could become a more regular occurrence.
The rate of interest in Japan is still zero, and is likely to stay at that level for some time
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