German business confidence rises as Greek deal eases concerns
German business confidence unexpectedly rebounded in July as the economy showed signs of a pickup and concerns eased over the crisis in Greece.
The Ifo institute’s business climate index climbed to 108, the first increase in three months, from 107.4 in June. The median estimate was for a decline to 107.2, according to a Bloomberg survey of economists.
The Bundesbank said in its July monthly bulletin that “strong” increases in factory orders during April and May, especially from abroad, suggest a revival in the German economy in coming months. The outlook may also be bolstered by a euro- area deal to give Greece a third bailout, averting the nation’s default and potential exit from the single currency.
A gauge of manufacturing and services activity in the euro zone published last week showed economic growth remaining robust, even though the region lost some momentum.
Markit Economics said its composite purchasing managers’ index slipped to 53.7 in July from 54.2 in June, still above the 50 mark that divides expansion from contraction. Germany’s reading was 53.4, an unexpected decline from the previous month.
In Greece, six months after the Syriza party won elections and plunged the country into turmoil by rejecting the terms of its bailout package, a new program is now on the table. That’s calmed concerns that the country would spark a region-wide crisis by failing to pay its debts and splintering the 19-nation currency bloc.
[Bloomberg]
