Ifo index of German optimism falls, could mean more pressure on ECB to cut rates

FRANKFURT, Germany – A closely watched index of German business optimism fell more than expected in April in a sign that Europe's biggest economy might not be rebounding as strongly as expected.

The Ifo index fell to 104.4 points from 106.7 in March. Markets expected a more modest decline to 106.2.

The downbeat reading could add to the pressure on the European Central Bank to cut interest rates. Weakness in Germany would make it harder for the 17-country eurozone to climb out of recession.

Ifo's Kai Carstensen said the index remained at a high level but showed increased doubts about the future.

The German economy shrank 0.6 percent in the last three months of 2012. Most economists expected it grow this year — expectations that have been shaken this week by weak surveys.