FRANKFURT AM MAIN: German businesses felt more confident in April but were cautious about the future economic outlook, a monthly survey from the Munich-based Ifo institute showed Monday.
Ifo’s closely-watched business confidence index climbed to 112.9 points from 112.4 points in March, beating analyst expectations to reach its highest level since July 2011.
Businesses were much more confident about the present economic situation but slightly gloomier about the future outlook, the survey of around 7,000 firms showed.
“The mood in German boardrooms has improved again,” commented Ifo president Clemens Fuest, noting that “the German economy is growing powerfully,” despite the slightly less positive expectations for the coming months.
Looking to different sectors, manufacturers were less upbeat than in March, while retailers, wholesalers and construction firms all saw the mood improve.
“The German economy seems to have entered an almost endless positive cycle,” said analyst Carsten Brzeski of ING Diba bank, pointing to “earlier reforms, low interest rates, a weak euro and strong private and public consumption”.
“Not only the German economy, but the entire eurozone economy could become the positive growth surprise of 2017,” Brzeski went on.
Jennifer McKeown of Capital Economics cautioned that “expectations softened slightly, perhaps suggesting that growth may be nearing a peak”. But she allowed that “upside risks” to the economic forecasts seemed more likely.