Financial News: German Ifo Business Sentiment Weakens Unexpectedly

German Ifo Business Sentiment Weakens Unexpectedly

11/24/2025 - 05:39:00 (RTTNews)

(RTTNews) - German business confidence weakened in November as companies turned more pessimistic about outlook despite unprecedented fiscal policy U-turn, results of a closely watched survey by the ifo institute showed on Monday.

The business climate index fell to 88.1 in November from 88.4 in October. The reading was expected to rise to 88.6.

Companies assessed their current situation as somewhat more positive, while they were more skeptical about the months ahead.

Companies have little faith that a recovery is coming anytime soon, ifo Institute President Clemens Fuest said.

The current situation indicator posted 85.6 in November, up from 85.3 in the previous month. Economists had forecast the score to rise to 85.5.

On the other hand, the expectations index dropped more-than-expected to 90.6 from 91.6 a month ago. The reading was seen at 91.4.

In manufacturing, business confidence deteriorated in November. Companies are more skeptical about the months ahead. However, current business conditions were slightly better. In the service sector, the business climate improved once again. Service providers assessed the current situation as somewhat more positive but their expectations deteriorated slightly.

The business climate in trade deteriorated in November. Companies assessed their current situation as somewhat worse, and expectations declined. Retailers were disappointed at the start of the Christmas season.

Similarly, confidence declined in the construction sector. While the current situation showed a clear upward trend, expectations were once again more pessimistic.

"With dropping expectations and an only somewhat improving current assessment, the November Ifo index suggests that the German economy remains deeply stuck in stagnation at year-end," ING economist Carsten Brzeski said.

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