Unexpectedly Gloomy in Germany - Forecast Slashed

The German business climate deteriorates for the fourth month in a row and the decline is greater than feared, according to a monthly index from the analysis institute Ifo. At the same time, leading economic institutes in Germany are lowering their growth forecast for 2024 and 2025.

» Published: September 24 2024

Unexpectedly Gloomy in Germany - Forecast Slashed
Photo: Michael Probst AP/TT

After Ifos unexpectedly gloomy September index, news agency Reuters reports that Germany's leading economic institutes have lowered their forecast for the German economy this year. They now expect Germany's GDP to shrink by 0.1 percent in 2024.

The growth forecast for 2025 is also being lowered to 0.8 percent, from previously 1.4 percent.

Index falls more than expected

Reuters refers to anonymous sources ahead of the publication of the new forecast on Thursday.

The Ifo index, which measures the mood in the German economy, fell to 85.4 in September – down from 86.6 in August. Analysts had on average expected a decline, but only to 86.0, according to a compilation of forecasts made by Bloomberg.

The sub-index for the current situation fell to 84.4 from 86.4. Analysts had also on average expected 86.0 for this sub-index.

For the manufacturing industry, the mood is now the worst since 2020, according to Ifo chief Clemens Fuest.

The core of German industry is facing headwinds

"Companies assess their current situation as significantly worse. Expectations are also significantly more pessimistic. The lack of new orders has intensified," he writes in a comment.

He adds that it is the core of German industry that is now facing headwinds.

The service sector also sees a worse situation now than before, but is not quite as negative about future prospects. And the mood in the tourism industry has improved, according to Ifo.

Tags

TTT
By TTThis article has been altered and translated by Sweden Herald

More news

Renault Acquires Full Ownership of
1 MIN READ

Renault Acquires Full Ownership of Renault Nissan Automotive India

Northvolt to Lay Off Half
1 MIN READ

Northvolt to Lay Off Half of Skellefteå Factory Workforce

Court Upholds Verdict Against Pension
1 MIN READ

Court Upholds Verdict Against Pension Saver in Falcon Funds Case

Huawei Reports First Quarterly Loss
1 MIN READ

Huawei Reports First Quarterly Loss in Years Following Sanctions

France Fines Apple 150 Million
1 MIN READ

France Fines Apple 150 Million Euros for Competition Violations

Maurel & Prom Shares Drop
1 MIN READ

Maurel & Prom Shares Drop 15 Percent After Venezuela License Revoked

Norwegian Oil Fund Invests 1.4
1 MIN READ

Norwegian Oil Fund Invests 1.4 Billion Euro in Offshore Wind Projects

Sweden's Wage Talks Reach Critical
1 MIN READ

Sweden's Wage Talks Reach Critical Stage as Deadline Looms

Sweden Tops Nordic Region in
1 MIN READ

Sweden Tops Nordic Region in Money Laundering, Report Finds

Swiss Varo Energy to Acquire
1 MIN READ

Swiss Varo Energy to Acquire Swedish Fuel Company Preem

German Retail Sees Surprise 0.8
1 MIN READ

German Retail Sees Surprise 0.8 Percent Growth in February

Half of Retrained Workers Shift
1 MIN READ

Half of Retrained Workers Shift to New Industries, CSN Reports

EQT-Backed Omega II Bids 54.9
1 MIN READ

EQT-Backed Omega II Bids 54.9 Billion Kronor for Fortnox

Food Prices Continue to Climb,
3 MIN READ

Food Prices Continue to Climb, but Major Increases May Be Over

Stockholm Stocks Slide as Trump's
2 MIN READ

Stockholm Stocks Slide as Trump's Tariff Plans Stir Markets

Tokyo Stocks Drop Sharply as
1 MIN READ

Tokyo Stocks Drop Sharply as Trump Tariffs Loom

Trump and Starmer Discuss Progress
1 MIN READ

Trump and Starmer Discuss Progress on US-UK Trade Deal

Håkan Samuelsson Returns as Volvo
2 MIN READ

Håkan Samuelsson Returns as Volvo Cars CEO to Drive Electric Future

Security Fund Reports Fewer Layoffs,
2 MIN READ

Security Fund Reports Fewer Layoffs, Sees Hope for Skilled Workers

South Korea, China, Japan Collaborate
1 MIN READ

South Korea, China, Japan Collaborate to Boost Free Trade

Trump's Diversity Order Faces Pushback
1 MIN READ

Trump's Diversity Order Faces Pushback from European Companies

Sweden Seeks to Shield Key
2 MIN READ

Sweden Seeks to Shield Key Goods from EU-US Tariff Clash

Weekend Push for New Industrial
2 MIN READ

Weekend Push for New Industrial Agreement as Deadline Looms

Swedes Opt for Europe as
3 MIN READ

Swedes Opt for Europe as US Travel Bookings Drop 30 Percent

Energy Efficiency Boosts Villa Prices
1 MIN READ

Energy Efficiency Boosts Villa Prices in Sweden's Real Estate Market

Elon Musk's XAI Acquires Platform
1 MIN READ

Elon Musk's XAI Acquires Platform X in Major Tech Move

Inflation Concerns Drag Down Wall
1 MIN READ

Inflation Concerns Drag Down Wall Street Indices

Sweden Seeks New Investors for
1 MIN READ

Sweden Seeks New Investors for Bankrupt Northvolt Battery Firm

US Inflation Surprises with Higher
1 MIN READ

US Inflation Surprises with Higher Than Expected February Rate

Li Ka-Shing Halts Sale of
1 MIN READ

Li Ka-Shing Halts Sale of Panama Canal Ports Amid Beijing Pressure

Princess Madeleine Addresses Criticism Over
2 MIN READ

Princess Madeleine Addresses Criticism Over New Skincare Venture

Stockholm Stocks Slide 4.5 Percent
1 MIN READ

Stockholm Stocks Slide 4.5 Percent in a Week as US Inflation Hits

French Inflation Dips Below Expectations,
1 MIN READ

French Inflation Dips Below Expectations, Impacting ECB Decisions

Cautious Consumer Spending Sees Slight
1 MIN READ

Cautious Consumer Spending Sees Slight Uptick in Sweden's Retail Sales

SSAB Faces Financial Supervisory Authority
1 MIN READ

SSAB Faces Financial Supervisory Authority Probe Over Reporting Rules

79,000 Swedes Face Student Debt
1 MIN READ

79,000 Swedes Face Student Debt with Enforcement Authority in 2024

Royal Expert Questions Princess Madeleine's
3 MIN READ

Royal Expert Questions Princess Madeleine's Skincare Venture

Gold Prices Reach New Heights
1 MIN READ

Gold Prices Reach New Heights as Trade Tariff Concerns Grow

Asian Markets Tumble as Investors
1 MIN READ

Asian Markets Tumble as Investors Brace for New US Tariffs

Trump's Tariff Plan Could Drive
2 MIN READ

Trump's Tariff Plan Could Drive Up Car Costs, Impact US Market