The German economy was hit by a wave of negative news from the manufacturing sector, which led to a sharp drop in investor confidence. In September, the investor confidence index (ZEW) fell to the lowest level since October 2023, amounting to only 3.6 points. This is a significant decrease compared to August, when the ZEW was at 19.2 points. According to the president of the Center for Economic Research in Europe, Achim Wambach, "the hope for an early improvement in the economic situation is noticeably fading. Although the decrease in expectations in the eurozone indicates an overall increase in pessimism, the decrease in expectations for the German economy is particularly significant." The deterioration in the prospects for Europe's largest economy began after production unexpectedly declined in the second quarter of 2024. The weak performance of the industry has become a wake-up call. The situation was further affected by a series of negative news from leading German companies. Volkswagen plans to close 2-3 factories in the country and reduce up to 15,000 employees. BMW lowered its profit forecast for 2024 due to the recall of 1.5 million vehicles due to problems with the braking system. And Intel postponed the construction of a chip manufacturing plant in Germany for 2 years.
