Business confidence in Germany unexpectedly fell during April for the first time six months, led by retailers and their suppliers, suggesting that Europe's largest economy may be slow to recover from last year's recession. The Ifo institute's index of western German business confidence, based on a survey ofseven thousand executives, fell to 90.5 in April from 91.5 in March. Analysts had forecast there to be an increase. “Consumers are very hesitant,” said Robert Schmitt, the chief executive officer of Koehler & Krenzer Fashion, a clothing retailer. The company expects profit to decline by two percent this year. “There is a clear reluctance to buy and that is likely to continue until the end of the year.” While manufacturers are benefiting from growing demand for exports, German retail sales declined for a third month in February. Unemployment, which has risen in fourteen of the previous fifteen months, is discouraging consumers from spending. Siemens has also announced a further 6,500 job losses at its networks business.
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