The ifo Business Climate Germany Index rose 0.6 pts to 87.5 (vs 87.4 expected) in May. The index is at its highest level since June 2024, driven by improved expectations despite a slight dip in current conditions.

• The Situation Index eased -0.3 pts to 86.1, and the Expectations Index increased 1.5 pts to 88.9.
• Manufacturing sentiment improved sharply to the strongest since June 2024, led by stronger expectations and a stabilizing order intake; the food industry saw a notable upturn, while chemicals worsened slightly.
• The services index continued to rise as expectations strengthened, though current conditions slipped; transport and logistics rebounded from recent weakness.
• Trade sentiment increased to the highest since May 2024, with strong gains in expectations and better current assessments in both wholesale and retail.
• Construction improved for the fourth straight month to a two year high, with a more positive view of current conditions and gradually improving expectations.