German business confidence edged higher in September for the sixth month in a row to its highest level in a year, a key index shows today. Business sentiment gained 0.8 points from August to 91.3, the Ifo research institute said.
However, analysts had expected the widely-watched index to rise to 92 points as Germany begins to pull out of its deepest recession in six decades.
Today's reading was the Ifo's survey's highest level since September 2008 when the collapse of US investment bank Lehman Brothers plunged the global financial system into crisis.
With German elections scheduled on Sunday, the increasingly positive economic mood is likely to work in favour of Chancellor Angela Merkel, whose Christian Democrats are leading in the polls.
'Appraisals of the business situation and outlook have improved,' Ifo president Hans-Werner Sinn said. 'However, by far the greater number of firms still assesses the business situation as poor,' he added.
Merkel has said that the worst is probably over for Germany but that the road to recovery will be a bumpy one.
Official data showed that the German economy climbed out of a historic recession in the second quarter of 2009, registering growth of 0.3% from the first three months of the year.
Last week, the ZEW survey of German financial market players for September rose slightly to reach its highest level since April 2006. 'The economic expectations for Germany are consistent with the picture that the German economy is recovering but at a slow pace,' the ZEW institute said.
