BERLIN (MktNews) - The German SPD-Green coalition government is sticking with its forecast of 2.75% economic growth in Germany this year despite worsening business sentiment in the country, the leader of the SPD parliamentary group, Peter Struck, said Wednesday at a press conference after the release of a stronger-than-expected drop in the Ifo index.
Germany's key economic barometer -- released Wednesday morning -- tumbled more than expected in February to a 1-1/2 year low. The Ifo's headline west German business climate index fell to 94.9 from 97.5 in January.
"The (real economic) situation in Germany is better than the (business) sentiment," Struck told reporters.
"The government is sticking to its (German) economic growth forecast for 2001 of +2.75% in a range of +/-0.125%," Struck said.
German Finance Minister Hans Eichel has said that the government forecast is based on a range of 2.625% to 2.875%, with growth likely at the lower end of that range.
Commenting Tuesday's 50 basis point interest rate cut by the U.S. Federal Reserve, Struck said: "We will have to wait now to see what impact these measures by (Fed chairman Alan) Greenspan will have."
Struck declined to comment on possible interest rate steps by the European Central Bank.