German Retailers Report Declining Business Confidence During Holiday Season

The Ifo business climate index for the retail sector dropped in December, reflecting weaker current assessments and cautious expectations for 2025.

The Ifo Institute's business climate index for German retailers fell to -23.0 points in December, down slightly from -22.2 points in November.
Retailers evaluated their current business situation as worse than the previous month, with expectations for the next six months also declining.
Economic challenges in 2024, including weakening demand and a shortage of skilled workers, have contributed to the sector's struggles.
While rising disposable incomes could provide a boost in 2025, economic policy uncertainty continues to weigh on both businesses and consumers.
The retail sector experienced some improvement earlier in 2024, but conditions deteriorated in the latter half of the year, according to Ifo surveys.