German business confidence improves more than expected
German business confidence improved more than expected in December, hitting its highest level in almost three years, according to a widely-followed survey.
The Ifo business climate index rose to 111.0 from 110.4 the month before, beating expectations for a reading of 110.6.
Meanwhile, the current assessment index increased to 116.6 from 115.6 in November, surpassing expectations of 115.9.
The expectations index nudged up to 105.6 in December from 105.5, versus expectations for it to remain unchanged.
The manufacturing, construction and wholesale trade indices all moved higher, while the retail trade sub-index was unchanged.
Clemens Fuest, President of the Ifo Institue, said: “The German economy is in a festive mood.
“The business outlook for the first half of 2017 is also slightly more optimistic. The German economy is making a strong finish to the year.”
Pantheon Macroeconomics said this was “another solid headline from German survey data”.
“Overall, the IFO continues to point to upside risk for German GDP growth in Q4, after the poor 0.2 quarter-on-quarter growth in Q3. Our base case is that real GDP will increase 0.4%-to-0.5% in the final three months of 2016. “