The ifo Institute's survey of about 9,000 German businesses revealed Monday that sentiment among the companies declined moderately in June.
According to the report, the ifo Business Climate Index was 88.6 in June, compared to 89.3 in May. Economists forecast the indicator to rise to 89.7.
The details of the report showed that the current situation sub-index remained at 88.3, while economists expected an increase to 88.4. Meanwhile, the gauge measuring companies' expectations for the coming months fell to 89.0 from 90.4 in the previous month. Consensus estimates suggested an increase to 91.0.
"The German economy is having difficulty overcoming stagnation," said Ifo president Clemens Fuest.