German business confidence declined slightly in August, according to a key survey released this morning.

The closely watched business climate index, calculated each month by the Ifo economic research institute, slipped to 94.6 points in August from 95 in July. The figure fell below analysts' consensus forecast of a slight rise to 95.2.

'All in all, the results are not an obstacle to a modest upward trend in the next few months,' Ifo president Hans-Werner Sinn said in a statement. The index had posted a noticeable rise in July from 93.3 points in June.

A breakdown of the August data showed that the six-month expectations sub-index edged up 0.3 points to 95.4, while the current sentiment sub-index fell 1.1 points to 93.8.

For its monthly survey, Ifo polls around 7,000 companies about their assessment of current business and their expectations for the next six months.