Fourth Ifo Index Rise Indicates Recovery

The Ifo business climate index, Germany's closely-watched business confidence indicator, rose for a fourth consecutive month in August, prompting analysts to predict a speeding up of the tentative recovery in the country's ailing economy during the second half of 2003. The index, based on a survey of some 7,000 businesses in the euro zone's largest economy, rose from 89.3 in July to a 14-month high of 90.8, surprising many forecasters who had expected an increase to 90. The index figure for August is the latest in a string of indicators since July which have shown signs of a recovery in Germany. Companies’ assessment about current economic conditions also rose, indicating that the latest improvement was not solely based on expectations of the future.