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Germany’s Ifo Business Climate Index climbed to 86.6 in July 2026, its third consecutive monthly increase and slightly above market expectations of 86. The reading signals a slow stabilization of the German economy, but the outlook remains fragile amid persistent tensions in the Middle East. Business expectations for the coming months improved to 86.7 from 84.3 in June, while companies’ assessment of current conditions slipped to 86.5 from 87.0, indicating that a full recovery has yet to take hold.
