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Ifo: German business outlook improves as manufacturing woes ease

German business sentiment remained unchanged in October, amid an improving business outlook and easing manufacturing woes, according to a survey by the ifo Institute.

The seasonally adjusted ifo Business Climate Index was steady at 94.6 in October from September, compared to the Econoday consensus estimate of 94.5.

The expectations index rose for the first time after six consecutive declines, to 91.5 from 90.9, though the current business situation index fell to 97.8 in October from 98.6 in September.

The deepening manufacturing downward ceased for now, as the index improved to negative 5.5 in October as a result of less pessimistic expectations, said Clemens Fuest, president of the ifo Institute.

The business climate indicator for the service sector edged down to 16.6 in October from 16.7 in the prior month, while that for trade improved to negative 3.3 from negative 3.7 in September.

According to market research firm GfK, German consumer sentiment marginally improved in October, but global trade frictions, Brexit uncertainty and mounting domestic job losses dampened the mood for November.

The German federal government lowered its GDP growth forecast for 2020 to 1.0% from a previous estimate of a 1.5% expansion, but ruled out crisis fears. Deutsche Bundesbank said in its latest monthly report that Germany's economic output may have slightly declined again in the third quarter amid a continued slump in the country's export-oriented industry.

In another previous survey by research institute ZEW, Germany's economic outlook worsened in October from the prior month.