German business confidence retreats from 15-month high

(Sharecast News) - Business sentiment in Germany unexpectedly fell in September, pulling back after hitting a 15-month high in August, according to a closely watched survey by the Ifo Institute. The Ifo's Business Climated Index declined to 87.7 this month, down 1.2 points from a revised 88.9 in August, which was the highest level recorded since May 2024.

This was the sharpest monthly fall in more than a year, coming in below the consensus forecast of 89.3.

"Companies were less satisfied with current business, while their expectations clouded noticeably. Prospects for an economic recovery have suffered a setback," the Ifo said in its report.

The index, which tracks around 9,000 responses each month from businesses across manufacturing, services, trade and construction, showed optimism levels (the percentages of positive responses minus the negative responses) were in negative territory across all four sectors, with the service sector falling into the red after three months above water.

Across all sectors combined, the present situation gauge fell to a nine-month low of 85.7 from 86.4, while the expectations indicator dropped to a four-month low of 89.7 from 91.4.