German business confidence has hit its highest level for 17 months, despite the ongoing emissions scandal that has rocked the country's car manufacturing industry.
The business climate index for German industry and trade released by research group IFO rose to 109 points in November from 108.2 points in October.
"The German economy remains unaffected by growing uncertainty worldwide," IFO said.
Optimism climbed in manufacturing, construction and wholesaling but declined in retailing. Manufacturers said they expected to ramp up production in the coming months.
Figures released this morning confirmed a previous estimate that the German economy, the biggest in the Eurozone, grew 0.3 per cent in the three months to September.
"November’s German IFO survey supported the message from other survey indicators that the economy is still growing at a healthy pace," said economist Jennifer McKeown from Capital Economics.
"And the breakdown of third quarter GDP showed that, unusually for Germany, consumers are driving growth."