diff --git a/merge-recursive.c b/merge-recursive.c
index 05311e411c..786dee7596 100644
--- a/merge-recursive.c
+++ b/merge-recursive.c
@@ -202,7 +202,8 @@ static int add_cacheinfo(unsigned int mode, const unsigned char *sha1,
 {
 	struct cache_entry *ce;
 	ce = make_cache_entry(mode, sha1 ? sha1 : null_sha1, path, stage,
-			      (refresh ? CE_MATCH_REFRESH : 0 ));
+			      (refresh ? (CE_MATCH_REFRESH |
+					  CE_MATCH_IGNORE_MISSING) : 0 ));
 	if (!ce)
 		return error(_("addinfo_cache failed for path '%s'"), path);
 	return add_cache_entry(ce, options);
diff --git a/t/t3030-merge-recursive.sh b/t/t3030-merge-recursive.sh
index 3db3bf6651..82e18548c3 100755
--- a/t/t3030-merge-recursive.sh
+++ b/t/t3030-merge-recursive.sh
@@ -518,7 +518,7 @@ test_expect_success 'reset and bind merge' '
 
 '
 
-test_expect_failure 'merge-recursive w/ empty work tree - ours has rename' '
+test_expect_success 'merge-recursive w/ empty work tree - ours has rename' '
 	(
 		GIT_WORK_TREE="$PWD/ours-has-rename-work" &&
 		export GIT_WORK_TREE &&