“The preliminary results for the Composite PMI for June show a further slight deterioration in business sentiment in Germany, driven by the services sector. This continued downturn suggests that the war in Iran is just one factor weighing on business sentiment. It is also noteworthy in this context that sentiment among French businesses improved significantly in June. There is no question that the end of the Iran war and the decline in oil prices will have a positive impact on the German economy. However, today’s figures suggest that this alone will not be enough to trigger a renewed acceleration later in the year. Fiscal stimulus and further reform efforts are necessary for a lasting improvement in sentiment.”

Dr Dirk Schumacher

"Kevin Warsh certainly imagined a different start. The US consumer price index (CPI) recently rose to 4.2 percent year-on-year, reaching its highest level in three years. At the same time, the labor market remains surprisingly robust, making interest rate cuts unlikely for the foreseeable future. Increasingly, rate hikes are being discussed as a risk scenario. This debate will likely gain relevance with the duration of the Iran war. Consequently, Warsh faces a balancing act right at the start of his term. Although US-President Donald Trump explicitly emphasized Warsh's independence during the handover, political expectations for lower borrowing costs inevitably resonate in the background. The new Fed chair must now manage expectations for both the markets and the White House."

Dr Stephan Bales

“The ECB is expected to raise interest rates by 0.25 percentage points on Thursday. The message from the Governing Council has been very clear. This move is intended to send a signal to the financial markets, as well as to businesses and households, that the ECB is keeping a very close eye on inflation trends. Uncertainty regarding the future course of the economy and price developments remains very high. A sharp economic slowdown in the coming months would do the ECB’s work for it – and render further interest rate hikes unnecessary. There will therefore be no clear signal on Thursday of further monetary tightening. Instead, President Lagarde is likely to speak primarily in the subjunctive and emphasise the need for further data to gain clarity on the future course.”

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

"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