• Prior was 86.6
• Current conditions 88.5 vs 87.0 expected
• Prior 86.5
• Expectations 89.1 vs 87.5 expected
• Prior 86.7

German business sentiment improved notably in August, with the Business Climate Index rising to 88.8, well above the 87.2forecast and up from 86.6 in July. The report showed a broad-based improvement in both current conditions and future expectations, pointing to strengthening after several months of gradual stabilization.

The Current Conditions Index climbed to 88.5, beating expectations of 87.0 and improving from 86.5 previously. Meanwhile, the Expectations Index jumped to 89.1, significantly above the 87.5 forecast and up from 86.7 in July, indicating that firms have become more optimistic about the economic outlook over the next six months.

The stronger figures follow recent signs of resilience in Germany’s economy, including improving manufacturing activity and a recovery in business expectations. Recent survey data have pointed to renewed momentum in the industrial sector, helping offset ongoing weakness in parts of the services economy, as seen in the Flash PMIs.