German business sentiment rises in June, Ifo says
German Business Morale and Economic Outlook
By Maria Martinez
June 24 (Reuters) - German business morale rose in June, a survey showed on Wednesday, with companies more positive about their current situation than they have been for nearly two years.
The Ifo institute said its business climate index increased to 85.6 compared to a revised 85.0 in May. The reading, which showed only a slight improvement in future expectations, was in line with a Reuters forecast.
"The German economy is hoping for an easing of the global political situation," Ifo President Clemens Fuest said.
Business morale rose across all business sectors.
Expert Reactions and Analysis
"Hope is back," said Carsten Brzeski, global head of macro at ING. "However, before getting overly enthusiastic, even with today’s increase the Ifo index still remains below its pre-war level."
Assessment of the Current Situation
ASSESSMENT OF THE CURRENT SITUATION DRIVES THE INCREASE
The increase in the headline index was in line with expectations, said Robin Winkler, Germany chief economist at Deutsche Bank Research.
Factors Behind the Rise
"What is striking, however, is that this was mainly due to a better assessment of the current situation," Winkler said.
Businesses were more satisfied with their current operations, with the index rising to 87.0 from 86.1 in May.
The rise suggests that the impact of the U.S.-Israeli war on Iran on activity is easing, said Harry Chambers, assistant economist at Capital Economics.
Future Expectations and Outlook
The outlook for the coming months was also less pessimistic, Ifo said, with the corresponding index rising to 84.1 from 83.9 in the previous month.
(Additional reporting by Reinhard Becker, editing by Thomas Seythal and Philippa Fletcher)
