BERLIN, Dec 18 Reuters German business morale unexpectedly worsened in December, the Ifo institute said on Monday after its latest survey also showed a decline in both expectations and current conditions.

The Ifo institute said its business climate index stood at 86.4 versus the 87.8 forecasts by analysts in a Reuters poll, following a revised reading of 87.2 in November.

As the year draws to a close, the German economy remains weak, Ifo president Clemens Fuest said.

The Ifo institute last week cut its forecasts for the German economy in 2024 to 0.9 growth instead of 1.4.

The fiscal woes of the last month have clearly left their mark on the German economy, with the country39;s most prominent leading indicator showing just how difficult it will be for the economy to bounce back, said Carsten Brzeski, global head of macro at ING.

The German government had to cut spending to plug a 17 billion euro 18.32 billion gap in its budget for 2024 after a constitutional court ruling on unused pandemic emergency funds blew a 60 billion euro 65 billion hole in its finances.

The renewed decline in business sentiment in December echoes the message from the Composite PMI released last week, showing that Germany39;s economic downturn worsened this month, with both manufacturing and services activity contracting.

Companies were less satisfied with their business, with the current situation index falling to 88.5 from 89.4 in November.

They were also more sceptical about the first…