By Rachel More
BERLIN (Reuters) – German business morale improved more than expected in October, a survey showed on Friday, offering hope for some respite towards the end of the year in the economy’s grinding battle with industrial woes and weak global demand.
The Ifo institute said its business climate index increased to 86.5 in October from 85.4 the previous month. Analysts polled by Reuters had forecast a reading of 85.6.
The recovery in business sentiment, which ends a four-month streak of decline, sounds a more positive note for the fourth quarter in Europe’s largest economy, which has long been battling to fend off recession.
On Thursday, a purchasing managers’ survey showed business activity declining again in October, albeit at a slower rate.
Economic data for the third quarter is due next week, with a slew of negative data putting a technical recession – defined as two consecutive quarters of contraction – firmly on the cards following a 0.1% drop in the April-to-June period.
For 2024 as a whole, the government expects output to contract by 0.2%, which would mark a second year of decline and cement Germany’s place as a laggard among its large euro zone peers.
(Reporting by Rachel More, Editing by Miranda Murray)
