German Business Confidence Hits Lowest Level Since May 2020

The Ifo Business Climate Index drops sharply in December, reflecting growing pessimism about future economic prospects.

The Ifo Business Climate Index fell to 84.7 points in December, marking its lowest level since the early months of the COVID-19 pandemic in May 2020.
This decline is the sixth in seven months, with businesses increasingly pessimistic about their future prospects despite a slight improvement in current conditions.
Key sectors, including automotive, electronics, and metal industries, are struggling, with structural challenges and weak global demand exacerbating their difficulties.
Economists warn that Germany's export-driven economy faces additional risks from geopolitical uncertainties and potential U.S. trade policies under President-elect Donald Trump.
Growth forecasts for 2025 have been downgraded, with some institutions predicting stagnation or minimal expansion of just 0.1–0.2%.