The Dax Index Falls Amid Negative German Business Sentiment

Summary:
• German business sentiment has been falling, which signifies the nation's economic challenges in a nutshell.

German business sentiment has been falling, which signifies the nation’s economic challenges in a nutshell. Harmful business conditions fuel the decline, and with the adverse business sentiment, there is no hope for a bullish trend soon.

The service sector of Germany hit its lowest levels in February this year and has yet to recover, while the manufacturing sector reached its lowest satisfaction level since 2020. A survey conducted on the German private sector indicates that employment has shrunk fastest in four years

The recession in Germany’s manufacturing sector deepened in August, with no recovery in sight, The odds of a second straight quarter of negative growth have gone up, meaning we might be back to talking about a recession in Germany soon,”

Said Dr Cyrus de la Rubia, Chief Economist at Humburg Commercial Bank

The German Federal Statistics (GFS) will publish its second estimate of the gross domestic product tomorrow (Tuesday). Initial data showed that the German economy shrank by 0.1%, cancelling the growth reported in the first quota.

The impact of the rising oil prices on the German economy

With the tensions in the Middle East escalating over the weekend, Inflation could rise, slowing down the economy as consumers have less disposable income. Brent crude oil went up by 1%, reaching 80 USD a barrel and could go up to 85 USD a barrel.

The German DAX trailed major eurozone indices after falling by 0.2%. This week will be fascinating for the DAX, so let’s keep an eye on it.