German July consumer confidence unexpectedly rose to 2.9and the June reading was revised up to 2.6 from 2.5 reported initially. We had been looking for an unchanged reading in June, which was in line with our median and based on the assumption that the deterioration on the labour market is weighing on cofindence. However, it seems that at least for now falling inflation and positive confidence data from the manufacturing sector are outweighing the impact of rising unemployment. The breakdown, which is only available until June, shows an improvement in the assessment of the economic outlook, but the reading remains firmly in negative territory at -22.6, indicating that pessimists outnumber optimists. The reading for income expectations improved to -3.3 from -9.3 and the reading for the willingness to buy improved to 14.5 from 12.5.