ifo Business Climate Falls (November 2025)

Sentiment among companies in Germany has deteriorated. The ifo Business Climate Index fell to 88.1 points in November, down from 88.4 points in October, due to more pessimistic expectations. On the other hand, companies assessed their current situation as somewhat more positive. They have little faith that a recovery is coming anytime soon.

In manufacturing, the index fell. Expectations in particular took a significant hit. Companies are more skeptical about the months ahead. They reported lower order books. Current business conditions, however, were slightly better.

In the service sector, the business climate improved once again. Service providers assessed the current situation as somewhat more positive; however, their expectations deteriorated slightly. There was a noticeable setback in the transport and logistics sector, while sentiment in tourism brightened significantly.

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

In construction, the index recorded a decline. While the current situation shows a clear upward trend, expectations were once again more pessimistic. Weak demand remains a decisive bottleneck.

Clemens Fuest
President of the ifo Institute