Planning is easier, and you can plan further out. Companies are certainly moving to capitalize on low rates to raise cheap money. In Germany, the housing market remains sluggish because of a huge building boom in the early 1990s. With mortgage rates at a postwar low of 6 percent, Deutsche Bank AG predicts housing investment will rise only 1.4 percent in Western Germany this year. Consumer and business confidence also suffer from high taxes and heavy labor-market regulations.
Consumers appear more responsive in France.
Housing lending jumped by 13.6 percent in October, and retail sales of durable goods were up 8 percent in December from a year earlier, said Eric Chaney, economist at Morgan Stanley Dean Witter. French companies don't know what labor costs will be in the year 2000,'' he said.