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Warsaw - German business sentiment rose to the highest level in almost three years in December, signaling growth in Europe’s largest economy picked up speed toward the end of the year.
The Munich-based Ifo institute’s business climate index climbed to 111 from 110.4 in November. That’s the strongest since February 2014 and compares with a median estimate in a Bloomberg survey of economists of 110.6.
The report is the latest indication that Germany’s economy may be back in the fast lane after a temporary slowdown in the summer months. IHS Markit’s Purchasing Managers’ Index showed last week that manufacturing was expanding at its strongest pace in almost three years in December, after unemployment held at a record low the previous month.
“The German economy is in a festive mood,” Clemens Fuest, Ifo’s president, said in an emailed statement. “The business outlook for the first half of 2017 is also slightly more optimistic.”
Fuest cited a stronger-than-anticipated economic expansion in the fourth quarter as one reason for a brighter 2017 outlook, when the institute raised its growth projections for the next two years on Friday.
A measure of current economic conditions rose to 116.6 from 115.6, according to the report. Ifo’s gauge of expectations improved to 105.6 from 105.5.
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