„The war in the Middle East and the resulting rise in energy prices have so far only moderately dampened business sentiment in Germany. According to the PMI survey, companies in the manufacturing sector even reported an increase in activity in March. Activity in the services sector, however, showed a significant decline. Since the manufacturing sector is, on average, more energy-intensive than the services sector, this divergence is surprising and suggests, at least for the moment, a certain robustness of the recovery. Nevertheless, the risks to the recovery have risen significantly and if oil and gas prices remain at current levels, they will weigh heavily on the recovery and possibly seriously jeopardise it, depending on how the war unfolds.”

Dr. Dirk Schumacher

“The attack on Iran and the resulting rise in energy prices are forcing the ECB, like other central banks, to make a difficult judgement call. Higher energy prices alone should not yet trigger a monetary policy response. Only when second-round effects set in motion a self-reinforcing dynamic will a tightening of monetary policy become unavoidable. However, this depends crucially on the magnitude and duration of the energy price shock. For the moment, the rise has been too short-lived and the data too ambiguous to force the ECB into a monetary policy response at this stage. The ECB will, however, leave no doubt in its communications regarding its fundamental readiness to tighten monetary policy should this become necessary. It is therefore likely that the word ‘vigilance’ will be the most frequently used term during President Christine Lagarde’s press conference on Thursday.”

Dr. Dirk Schumacher

"In view of the events in the Middle East, the inflation figures reported today for the Euro Area are nothing more than a starting point. At 1.9%, consumer price inflation in February was slightly below the ECB's inflation target. However, this will not remain the case in view of the sharp rise in energy commodity prices. In particular, the higher oil price will be quickly passed on to consumers and will already lead to a noticeable increase in fuel prices in March. However, this is no reason for the European Central Bank to act hastily. The scale of the energy price shock is not comparable to the price explosion of 2022 following Russia's attack on Ukraine. Whether interest rate hikes will be necessary depends heavily on the duration of the war, which is not yet foreseeable. The ECB can tolerate a temporary increase in the inflation rate of a few tenths of a percentage point as long as inflation expectations remain well anchored."

Stephanie Schoenwald

"Given the strong order intake in the manufacturing sector, an increase in the ifo Business Climate Index was long overdue. In January, the Greenland turmoil had certainly been a drag on sentiment. Also, it takes time for the large orders we saw at the end of 2025 to make themselves felt across the breadth of the economy reflected in the ifo index. With today's data point, it has become more likely that Germany is gearing up for an upswing."

Dr Sebastian Wanke

"Following several very strong quarters, US economic growth is cooling off as expected, reaching an annualised rate of 1.4% in the fourth quarter. The government shutdown between October and mid-November throttled momentum through reduced government spending and delayed consumption effects. All in all, 2025 reflects a solid growth rate of 2.2%, which is remarkable given the high level of political uncertainty and dynamic policy shifts. A key driver was the high level of investment in Artificial Intelligence, which remained largely unfazed by economic policy turbulence throughout 2025. In parallel, private consumption continues to support growth despite dampened sentiment. A decisive factor for the future trajectory will be whether the clouded household confidence begins to weigh more heavily on spending behaviour."

Dr Stephan Bales

“Today's slowdown in production follows three consecutive monthly increases. With an increase of 0.9 per cent compared to the third quarter, quarterly momentum remains strong. Together with the excellent order intake, which will only have an impact on production after a delay, the trend reversal in production in this country is likely to be completed soon. Overall, this is a solid foundation, perhaps even a springboard for growth in 2026."

Dr Sebastian Wanke

„In its flash estimate, the Federal Statistical Office calculated that German GDP stagnated in the third quarter. We should not generally attach too much importance to this figure (0.0%). Experience in recent years has shown that initial growth calculations are highly susceptible to revision. What was initially predicted to be quasi-stagnation in 2023 and 2024 turned out to be a significant recession in retrospect. As the name suggests, even the initial official growth rates are only estimates based on incomplete data. The decisive factor is the overall picture provided by the growth figures and the so-called soft indicators from company surveys such as the Purchasing Managers' Index or the ifo Business Climate Index. Measured against this, the economic picture for the third quarter is also only mixed, which roughly corresponds to the reported stagnation.”

Dr Philipp Scheuermeyer