BERLIN (Reuters) – German business morale improved for the first time this year in August, a benchmark survey showed on Monday, suggesting that company executives in Europe’s largest economy are less worried about the threat of a global trade war.
FILE PHOTO: The Frankfurt skyline with its financial district is photographed in the early evening in Frankfurt, Germany, March 25, 2018. REUTERS/Kai Pfaffenbach/File Photo
The Munich-based Ifo economic institute said its business climate index jumped to 103.8, beating July’s reading of 101.7 and a Reuters consensus forecast of 101.9.
“In addition to a robust domestic economic situation, the truce in the trade conflict with the U.S. contributed to improved business confidence,” Ifo chief Clemens Fuest said.
“The German economy is performing robustly. Current figures point to economic growth of 0.5 percent in the third quarter.”
The main support came from services and construction, but business sentiment also improved slightly in manufacturing and retailing, a sector breakdown showed.
The Ifo data chimed with August’s IHS Markit sentiment survey among purchasing managers, which showed the private sector shifting into a higher gear, also helped by strong services activity.
“The global trade dispute so far hasn’t turned out to be a sentiment killer,” Alexander Krueger from Bankhaus Lampe said. “Everything is pointing to a continuation of the robust upswing.”