Ifo – fiscal package boosts growth outlook
The sixth consecutive increase in the Ifo Business Climate Index (88.4 after 87.5) is a clear signal that the economic downturn is behind us.
Commerzbank Economic Research
06/24/2025
The Ifo Business Climate Index surged again in June – from 87.5 to 88.4. The increase was slightly stronger than expected (Consensus & Commerzbank: 88.0). While companies assessed the current economic situation only marginally better this time (86.2 after 86.1), they expressed significantly more optimism regarding the expected development over the next six months (90.7 after 89.0).
The business climate improved in June across most industries. An exception was the manufacturing sector, where sentiment practically stagnated. However, there had been a strong increase in this sector the previous month, and the trend continues to point clearly upwards. This aligns with the upward trend in the Purchasing Managers' Index for the manufacturing sector.
Trend growth remains low...
The increase in the Ifo Business Climate Index for the German economy does not reflect companies' joy over a much-needed fresh start in economic policy, following years of eroding competitiveness. For the average of the next ten years, we continue to expect only marginal growth (0.4% p.a.).
For full text see attached PDF-Version.
