German business confidence slips--report

As per the report by Munich-based Ifo Institute, business sentiment index fell to 95.2 from 95.8 in January.

Further, the current conditions index fell to 89.8 from 91.2.

Around 7000 companies, which participated in the survey, said that they were less optimistic about the current business conditions.

But the expectations index, highlighting the outlook for the upcoming six months, rose 100.9 from 100.6.

Sectoral analysis
Looking at the different sector of the economy, manufacturing and construction showed improvement as they jumped 0.1 point to -6.4, and 3.3 points to -18.1 respectively.

"In the construction sector, we see of course there is quite some order volume in the pipeline, which will feed production in coming months,” said Gernot Nerb, head of industry branch of Ifo Institute.

Exports also rose this month and the manufacturing sector contributed to this increase.

But the retail and wholesale sectors deteriorated, plummeting 9.1 and 3.1 points respectively.

Nerb added that there has been a weakness in consumption due to adverse weather conditions.

Analysts upbeat about future
The dip in the index has not come as a surprise as the reports released earlier this month had revealed weaker than expected gross domestic product.

"Responsible for this decline is especially the situation in retailing, which experienced a setback in February," Ifo said in a statement."The economic recovery is expected to continue when winter is over."

Bundesbank President Axel Weber stated that as per the GDP data released, it is likely that the economy could stagnate or shrink a little in the first quarter this year. However, the second quarter is expected to be strong.

Jennifer McKeown, senior European economist at Capital Economics, said that it is just hoped that economic activities have been damaged due to weather.

"For now, we still expect a strong competitive position to mean that Germany expands by a solid 2% this year,” McKeown added.