-Carsten Brzeski, ING-DiBa
German business sentiment fell less than expected in July, following the United Kingdom's vote to leave the European Union, survey results from the Munich-based Ifo Institute showed on Monday. The Ifo Business Climate Index dropped to 108.3 on a monthly seasonally adjusted basis in July, down from the previous month's reading of 108.7 points, whereas market analysts anticipated a steeper decrease to 107.4 in the reported month. The headline index posted the first decline in the three-month period, although it was the second highest result this year. According to the Ifo's sub-survey, the Current Assessment Index, which measures current conditions in the Euro zone's largest economy, came in at 114.7 in the same month, while markets penciled in a drop to 113.9 from last month's upwardly revised figure of 114.6 points. Furthermore, the Ifo Expectations Index, indicating companies' outlook for the next six months, rose to 102.2 month-over-month in July, while analysts predicted a fall to 101.0 in the first month of the Q3 2016, following June's 103.1 points.
The Ifo Business Climate Survey is based on approximately 7,000 monthly survey responses received from companies in manufacturing, construction, wholesale and retail across Germany.
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