Clemens Fuest

FRANKFURT, Germany (AP) — The trade cease-fire between the European Union and U.S. President Donald Trump boosted optimism among German business executives heavily dependent on trade for their profits, a closely watched economic index showed Monday.

The Ifo institute index rose to 103.8 points from 101.7 in July. The result was better than the 101.8 expected by market analysts.

The president of the most influential German economic institute, IFO Clemens Fuest, is not expecting the events in Spain and the possible secession of Catalonia to lead to turbulence in the currency union, sega said.

Confidence among German businesses eroded slightly in September, a regular survey published on Sept. 25 found, reflecting uncertainty ahead of a general election on Sept. 24 that has left Chancellor Angela Merkel facing tricky coalition talks.

German business morale dipped slightly in August but stayed close to last month's all-time high, a closely-watched survey said on Aug. 25, adding to a run of good news for Europe's powerhouse economy ahead of a general election.

The Munich-based Ifo institute said its business confidence index fell to 115.9 points this month after reaching an all-time peak of 116 points in July.

German business confidence unexpectedly rose in June to a record high, as strong domestic consumption and robust exports combined to make company executives increasingly upbeat about the growth outlook for Europe's largest economy.

The probability of Greece leaving the eurozone has jumped from virtually nothing to at least 20 percent since Syriza's Jan. 25 election victory, the head of the German ZEW think tank told Reuters.