Germany’s business climate improved in June 2025, with the ifo Business Climate Index rising to 88.4 from 87.5 in May—its highest point since June 2024. This uptick reflects growing optimism, especially in future expectations, which climbed to 90.7 from 89.
While the current situation assessment remained stable at 86.2, manufacturing sentiment steadied, with companies more hopeful about upcoming months despite ongoing challenges like weak order books and current performance.
The trade sector saw better conditions, driven by wholesale recovery, though retail sentiment slightly declined. Overall, the ifo business climate balance improved to -6.7 from -8.7, marking the best level since mid-2024.
Although still below pre-2024 levels, these indicators suggest a cautiously optimistic economic outlook for Germany moving forward.