The Ifo index, which is based on a survey of 9,000 German entrepreneurs, fell to 84.7 in December, down from 85.6 in November. The forecast among analysts was 85.5.
The Zew index, which reflects the mood among investors and analysts, improved instead. The index rose to 15.7 in December, up from 7.4 in November. Expectations were 6.9.
The indicators come at a time marked by stagnation in the German economy and in the midst of a political crisis, which, after Chancellor Olaf Scholz lost a vote of confidence in parliament on Monday, is expected to result in a new German election in February.
The German economy – with a heavy industry struggling against price pressure from Chinese competitors, high energy prices, and concerns about the threat of new US tariffs – is expected to shrink for the second year in a row in 2024. The central bank, Bundesbank, only expects a marginal recovery in 2025.
