In September, the ifo business climate index fell slightly by -0.2 points. The surveyed companies assessed both their business situation and their business expectations somewhat less positively than in August. However, this decline is not surprising, as the ifo index rose very strongly in August against the backdrop of at least a temporary easing in the trade dispute with the U.S. The development in the manufacturing sector is particularly interesting. Due to a less positive assessment of the current business situation, the index continued to fall. However, the manufacturing sector is much more confident about the future. Companies are planning to expand their production in the coming months – good news for the industrial production in Germany, which showed signs of weakness in recent months. Thanks to sustained robust domestic demand, we expect the German economy to continue to grow solidly in the second half of the year. However, foreign trade headwinds have intensified further in recent months as a result of the crises in some emerging market economies.