German business morale improved more than expected in June, a survey showed on Tuesday, with a particular improvement in companies’ future prospects.
The Ifo institute said its business climate index rose to 88.4 in June from 87.5 in May.
Analysts polled by Reuters had forecast a rise in the reading to 88.2.
“The German economy is slowly gaining confidence,” Ifo president Clemens Fuest said.
A separate Purchasing Managers’ Index survey on Monday showed that business activity in Germany returned to growth in June, driven by a recovering manufacturing sector that saw its strongest increase in new orders in over three years.
Germany, the only G7 nation that has recorded no economic growth for two consecutive years, faces another potential contraction in 2025 due to U.S. tariffs.
(Reporting by Miranda Murray and Maria Martinez)
