The Ifo Business Climate Index for industry and trade in Germany rose to 111.3 in February, Ifo said on Monday.
This is the fourth consecutive rise of the business climate index, which is considered the most important barometer for the German economy. The index rose from 110.6 in January, the Munich-based think tank said.
Expectations regarding future business developments dipped slightly, but remain optimistic, according to Ifo's newly released report, based on a monthly survey of about 7,000 firms.
In addition, retail increased significantly, while wholesaling fell slightly, Ifo said.