Companies in Germany are losing steam, investments are falling

According to the latest DIHK survey, the German economy will remain under pressure in 2026, with no significant recovery in sight. Although some sectors are benefiting from global economic growth and higher defense spending, the overall picture is rather bleak.

As announced by the DIHK, the sentiment index rose slightly, but at 95.9 points, it is still well below the long-term average. Only a quarter of companies rate their situation as good, and the same proportion consider it to be bad.

According to DIHK head Helena Melnikova, Germany has been virtually stagnant since 2019, while the US and Italy have grown significantly faster. Companies are struggling with weak domestic demand, high labor and energy costs, and economic policy uncertainty.

Investment remains subdued, and companies are cautious about hiring new employees. The DIHK is therefore calling on the government to implement radical reforms—less bureaucracy, lower costs, and stable rules—otherwise the economy will not get out of the "valley."

(pir)