German IFO Business Climate Index improves to 91.8 in April, rescues EUR bulls

• German IFO Business Climate Index came in at 91.8 in April.
• IFO Current Economic Assessment jumps to 97.2 this month.
• April German IFO Expectations Index arrived at 86.7.

The headline German IFO Business Climate Index unexpectedly improved to 91.8 in April versus last month's 90.8 and the consensus estimates of 89.1.

Meanwhile, the Current Economic Assessment climbed to 97.2 points in the reported month as compared to March's 97.1 and 95.8 anticipated.

The IFO Expectations Index – indicating firms’ projections for the next six months, rose to 86.7 in April from the previous month’s 84.9 reading and surprised the market to the upside with 83.5.

Market reaction

The recovery in EUR/USD found extra legs on the German IFO positive surprise.

At the time of writing, the pair is trading at 1.0749, extending its rebound from multi-month lows of 1.0707. The spot is still down 0.41% on the day.

About German IFO

The headline IFO business climate index was rebased and recalibrated in April after the IFO research Institute changed series from the base year of 2000 to the base year of 2005 as of May 2011 and then changed 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.