Index at 93.3 vs expected 91.0
Bank turmoil had little effect Ifo
No reason for optimism analysts

BERLIN, March 27 Reuters German business morale unexpectedly rose in March, adding to signs that Europe39;s largest economy is stabilizing despite recent turmoil in the banking sector, a survey showed on Monday.

The Ifo institute said its business climate index jumped to 93.3 from a reading of 91.1 in February. A Reuters poll of analysts had pointed to a March reading of 91.0.

The improvement in business morale for the fifth month in a row was driven primarily by business expectations, which rose to 91.2 in March from a revised 88.4 the month before, its highest level in at least a year, according to Ifo.

The managers at 9,000 companies surveyed by Ifo had not changed their positive sentiment, despite the banking sector turmoil, likely because no German bank has so far been affected, Ifo head of surveys Klaus Wohlrabe told Reuters.

Despite the turbulence in the financial markets, the German economy is starting spring with a good feeling, he said.

The German government has said the economic situation should improve from spring onwards, and in January revised up its economic forecast for 2023, predicting growth of 0.2.

Analysts welcomed the unexpected increase but warned against being too optimistic about what it means for the months ahead.

All in all, the business climate is not yet based on anything more than hope, said economist Alexander Krueger at private…