German IFO Business Climate Index improves to 93.6 in April vs. 94 expected

• German IFO Business Climate Index improved modestly in April.
• EUR/USD trades in the upper half of its daily range slightly below 1.1000 after the data.

The headline German IFO Business Climate Index edged higher to 93.6 in April from 93.2 in March. This reading came in slightly weaker than the market expectation of 94.

Meanwhile, the Current Economic Assessment dropped to 95 from 95.4 and the IFO Expectations Index – indicating firms’ projections for the next six months, rose to 92.2 from 91, surpassing analysts' estimate of 91.6.

Market reaction

EUR/USD gained traction and turned positive on the day near 1.0990 with the initial reaction.

About German IFO

The headline IFO business climate index was rebased and recalibrated in April after the IFO Research Institute changed the series from the base year of 2000 to the base year of 2005 as of May 2011 and then changed the series to include services as of April 2018. The survey now includes 9,000 monthly survey responses from firms in the manufacturing, service sector, trade and construction.