Economy economic activity 2002: Forecasting and reality

Last year proved to be a year of disappointed economic hopes for the German economy; the Ifo Institute also had to revise its German forecast downward. The expected economic recovery in the second half of 2002 did not materialise. Attributable for the poor performance of the German economy was the insecurity caused by the Iraq conflict, the rise of the crude oil price and the strong decline in stock market prices. The US economy also proved to be weaker than expected.