Economic Briefing/Economic Insights

Ifo rises not only due to the fiscal package

The significant improvement in the German Ifo business index in March (86.7 after 85.3) partly reflects the hope of many companies that the future government's financial package will ultimately boost the economy. However, the Ifo's significant increase is probably also due to a recovery in global manufacturing, which is benefiting from rate cuts by Western central banks. A strong, self-sustaining upturn in German manufacturing would, however, require a fresh start in economic policy, which is not yet apparent in the coalition negotiations.