Germany Business Confidence

The Ifo Business Climate Index for Germany decreased to 87.6 in December 2025, the lowest in seven months, compared to a downwardly revised 88 in November and forecasts of 88.2. The expectations gauge weakened to 89.7 from 90.5, while assessments of current conditions was steady at 85.6. “Companies are more pessimistic about the first half of 2026. The year is ending without any sense of optimism", Ifo President Clemens Fuest said. The manufacturing index declined across most industries, driven by weaker expectations despite a slight improvement in the current situation. New orders fell and production plans were cut. The services business climate slipped into negative territory as current assessments and expectations worsened. Retail showed a weaker current situation and bleak expectations for early 2026 following disappointing Christmas sales. Construction remained subdued, with a weaker current situation partly offset by improved expectations.