German business confidence unexpectedly rose in April, signaling optimism that Europe’s largest economy will withstand risks from tension in Ukraine to price weakness in the euro area.

The Ifo institute’s business climate index, based on a survey of 7,000 executives, advanced to 111.2 from 110.7 in March. Economists predicted a decline to 110.4, according to the median of 34 estimates in a Bloomberg News survey.

German manufacturing and services activity is expanding at near the fastest pace since 2011 as the country leads a recovery in the 18-nation euro area. At the same time, the European Central Bank has pledged to add stimulus if needed to counter threats to regional growth that include low inflation and Russia’s territorial dispute with Ukraine.

“The outlook for the economy remains bright on a general basis, and we don’t see movements that could immediately reverse sentiment,” said Alexander Koch, an economist at Raiffeisen Schweiz in Zurich. “But there are risks correlated with rising trade uncertainty with Russia because of the Ukraine crisis, and partly to slower dynamics in emerging markets.”

A measure of current conditions rose to 115.3 in April from 115.2 the prior month, Ifo said. A gauge of expectations climbed to 107.3, rebounding from the lowest level since October. The euro gained 0.1 per cent to $1.3837 earlier. Germany’s DAX stock index advanced 0.7 per cent to 9,613.

The Ifo report follows purchasing managers indexes yesterday that showed German manufacturing and services strengthened this month. A composite gauge by London-based Markit Economics rose to 56.3, near the February reading of 56.4 that was the highest since May 2011. European car sales jumped more than 10 percent in March for a seventh consecutive monthly gain, according to the European Automobile Manufacturer’s Association.