Xavier Fonder Gloria
German business confidence rose in December to its highest level since August, fueling optimism that the current recession may not be as severe as feared.
The Ifo business climate index rose to 88.6 in December from a revised 86.4 in November, the third improvement in as many months, according to data released by the Ifo Institute on Monday.
Economists surveyed by The Wall Street Journal expected the index to rise to 87.4. Despite the recent improvement, German business confidence remains very subdued by historical standards.
“The mood in the German economy has improved considerably,” Ifo Chairman Clemens Fuest said. “German businesses are heading into the holiday season with hope,” he said.
The data showed that the current situation index rose to 94.4 in December from 93.2 in the previous month, while a gauge assessing company expectations rose to 83.2 from 80.2.
The Ifo index is based on surveys of around 9,000 companies in the manufacturing, services, trade and construction sectors.
Write to Xavier Fontdegloria at xavier.fontdegloria@wsj.com