Germany's key business barometer the Ifo index rose in March to levels last seen before the September 11th attacks, confirming that Europe's biggest economy was recovering from a mild recession.
The Ifo economic institute said today its headline west German business climate index, based on a monthly survey of around 7,000 firms, climbed for the fifth month in a row to stronger-than-expected 91.8 from a revised 88.5 in February.
The March reading was at the highest level since April 2001 and well above the consensus forecast for a rise to 90.3.
"The improvement is almost entirely a result of better business expectations for the coming months," Ifo president Mr Hans-Werner Sinn said in a statement.
The expectations index, which reflects companies' view of business six months ahead, surged to 106.3 points from 101.0 points in February, its highest level since mid-2000.
The assessment of current business conditions improved slightly in March, with the index edging up to 76.9 from 76.8.
In East Germany, the main business climate index rose to 100.8 from a revised 100.1 reading.