Ifo president expects deepest economic crisis since end of second world war

On Monday the president of the Ifo institute, Mr. Hans-Werner Sinn, predicted the German economy to go through a very serious economic crisis. Said Mr. Sinn: “The German economy is about to go through the deepest recession since the end of the second world war.” Mr. Sinn expects the German GDP to shrink by at least 2% in the year 2009 and unemployment to increase by half a million people.

By the year 2010 unemployment might even reach 4 million people, according to Mr. Sinn. Currently the only glimmer of hope was a drop in the oil price which in 2009 would lead to a very small inflation rate of just 0.9 %. Nevertheless, Mr. Sinn does not expect the economy to gain momentum even in the year 2010. GERMAN