Business confidence among German companies has deteriorated further in December, with the ifo Business Climate Index slipping to 87.6 points from 88 points in November, according to the ifo Institute.
Firms are increasingly pessimistic about the first half of 2026, even as their assessment of the current situation remained broadly unchanged. Overall, the year is ending without any meaningful sense of optimism across the economy.
The downturn was particularly evident in manufacturing, where the business climate index declined across almost all sectors. The fall was mainly driven by more negative expectations for the months ahead, ifo said in a release.
Business sentiment in Germany has weakened again in December as the ifo Business Climate Index fell to 87.6 points from 88 in November.
Companies grew more pessimistic about the first half of 2026, while assessments of current conditions stagnated.
Manufacturing and trade both deteriorated, reflecting falling orders, production cut plans, and disappointing Christmas sales.
While assessments of the current business situation improved slightly, they remained at a weak level. Manufacturers also reported a decline in new orders and indicated plans to scale back production.
Conditions also worsened in trade, where the index fell as companies revised down their assessment of the current situation. Expectations for the first half of next year remain gloomy, pointing to subdued demand and limited recovery momentum. Retailers, in particular, expressed dissatisfaction with Christmas sales.
Fibre2Fashion News Desk (HU)