German Ifo business confidence unexpectedly improves in February

German business confidence unexpectedly improved in February, according to a widely-followed survey.

The Ifo Institute’s business climate index rose to 111.0 from 109.9 in January, beating analysts’ expectations for a decline to 109.6.

The expectations index edged up to 104.0 from 103.2 the month before, surpassing expectations of 103.0.

Finally, the current assessment index jumped to 118.4 from 116.9, comfortably beating estimates of 116.7 and marking the highest level since August 2011.

Clemens Fuest, president of the Ifo Institute, said: “After making a cautious start to the year, the German economy is back on track.”

Pantheon Macroeconomics said: “Another solid business survey in the eurozone’s largest economy. The headline mainly was boosted by a rise in the current assessment index, but the expectations index also edged higher to 104.

“The details, however, were slightly less upbeat. The construction index slipped to a five-month low, but continues to indicate strong Q1 performance in construction capex. The retail index also dipped, consistent with our assumption that retail sales and consumers’ spending growth is slowing slightly. Elsewhere, the manufacturing jumped, in line with the PMI, pointing to strong activity in this industry. Finally, the wholesale sub-index jumped too, indicating that suppliers to the SME sector is seeing strong demand.”