Germany Business Confidence


Business sentiment hits highest level in over two years

The business confidence indicator developed by the Ifo Institute rose in February and reached its highest level since July 2011. The indicator came in at 111.3 points, overshooting both the 110.6 points observed in January and the 110.5 points the market had expected. The print marks the fourth consecutive month of improvement following the slight retreat recorded in October.

February's result reflected a significant improvement in firms' assessments of their current business situations. That category rose to the highest level since April 2012. Conversely, businesses' assessment of their business expectations edged down slightly over the previous month. The Ifo Institute noted that, despite the slight decrease, business expectations remain highly optimistic. The Ifo added that, "the German economy is holding its own in a changeable global climate."

FocusEconomics Consensus Forecast panelists expect gross fixed investment to expand 3.9% in 2014, which is up 0.1 percentage points from last month's forecast. In 2015, the panel sees investment growth accelerating to 4.1%.

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Germany Business Confidence Chart

Germany Business Confidence February 2014

Note: Ifo Business Climate Index, 2000=100.
Source: Ifo Business Survey.

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