Sentiment in the German economy continued to improve this month. The Ifo Business Climate Index rose from 109.5 points in September to 110.5 points in October. Companies were more satisfied with their current business situation. They also expressed far greater optimism about the months ahead. The upturn in the German economy is gathering impetus.

In manufacturing the business climate index rose. This was once again due to a far more positive outlook for the months ahead, with expectations rising to a two-year high. Assessments of the current business situation also improved. Demand for capital goods is particularly strong. The capacity utilisation rate rose by 0.9 percent to 85.7 percent versus last quarter.