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Germany’s Ifo rises for a fifth straight month, ING cites resilience

ING points to fiscal stimulus and improving order books as support, while still warning political uncertainty prevents a confirmed structural recovery.

Reported · Written up by our desk · Central Banks

ING analyst Carsten Brzeski highlights Germany’s Ifo index as an early sign of improving economic momentum, noting it has risen for five consecutive months. In September, the Ifo index reached 89.9, up from 88.8 in August, the highest level in more than a year, according to FXStreet’s summary of ING’s view.

Brzeski attributes part of the resilience to fiscal stimulus and recovering order books, with government spending on defence and infrastructure beginning to filter into economic activity. However, he cautions that multiple downside risks and political uncertainty mean the recovery is not yet structural.

ING expects German GDP growth to be around 1% this year, with the strong performance earlier this year positioning the economy for its best growth since 2022, even as risks remain for the near-term outlook.

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