The Ifo business climate index for Germany´s industry and trade sector fell again in March. Neverthe-less, at 114.7 points, the index is still at a very high level. It is noteworthy, however, that companies' business expectations have already weakened for the fourth consecutive month. Several factors have probably contributed to the more subdued business expectations. The rise in the external value of the EUR in recent months is likely to have dampened export expectations. Moreover, the financing conditions for companies might no longer be as favorable as they have been so far given the withdrawal of central banks from their ultra-loose monetary policy. Most recently, however, concerns about increased U.S. protectionist measures and a potential trade war may have been of greater importance. In our economic base case scenario, we still do not assume that there will be an outright trade war. We therefore stick to our growth forecast for the German economy of +2.5% in real terms this year. However, the longer the uncertainty about a possible increase in protectionist measures persists, the greater the likelihood that this concern will eventually leave its traces in Germany´s real economy.