The Ifo institute said its business climate index rose to 88.6 from a revised reading of 86.4 in November.The indicator measuring how companies assess their current situation also posted a bigger-than-expected rise in December, to 94.4 from a revised 93.2 in November, marking a U-turn after six consecutive decreases. Analysts polled by Reuters had expected a reading of 93.5.
German businesses are entering the Christmas season with a sense of hope, said Ifo President Clemens Fuest. Signs have mounted in recent weeks that the German economy could stave off the worst of an economic downturn triggered by a plunge in energy supply from Russia after the Ukraine invasion. Inflation slowed slightly to 11.3% in November from a high of 11.6% the month prior as energy prices eased.
Meanwhile, Ifo was among the economic institutes to revise up their forecasts for 2023, now predicting a milder 0.3% contraction next year.
All sectors report Crisis or Slowdown..