Published by Global Banking & Finance Review®
Posted on April 2, 2026
2 min readLast updated: April 2, 2026
Add as preferred source on GoogleGermany’s chemical confidence plunged in March as the war in the Middle East triggered a sharp energy shock, exacerbating longstanding challenges like weak demand and high costs.
April 2 (Reuters) - Business confidence in Germany's chemical industry fell sharply in March as the war in the Middle East further clouded the sector's outlook, an Ifo survey showed on Thursday.
The Ifo institute's index for the sector dropped to -25.0 points from a seasonally adjusted -16.7 points in February, while expectations turned more pessimistic, sliding to -17.9 points from -12.1.
"The consequences of the military hostilities in the Middle East are hitting the already struggling chemical industry with full force," said Ifo industry expert Anna Wolf.
The German chemical sector, its third-largest industry, has been under pressure for years from weak demand, persistently high energy costs and supply chain disruptions, compounded by geopolitical tensions, most recently resulting from the Middle East conflict.
"Companies can scarcely influence the difficult conditions, so the only room for maneuver they have left is to cut jobs," said Wolf, adding that employment expectations also dropped to an all-time low of -32.1 points.
(Reporting by Anastasiia Kozlova and Amir Orusov, Editing by Friederike Heine)
The war in the Middle East worsened an already difficult outlook for Germany's chemical industry, causing a sharp decline in business confidence according to the Ifo survey.
The Ifo institute's index for the sector dropped to -25.0 in March from a seasonally adjusted -16.7 in February.
The industry is impacted by weak demand, high energy costs, supply chain disruptions, and geopolitical tensions such as the conflict in the Middle East.
Employment expectations dropped to an all-time low of -32.1 points, indicating companies are likely to cut jobs.
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