Confidence among German businesses fell back in March, a regular survey showed Thursday, with managers' mood clouding over as the threat of a transatlantic trade war draws nearer.
The Ifo institute's regular barometer fell 0.7 points for a reading of 114.7 this month, slightly lower than analysts surveyed by Factset had predicted.
Business leaders' judgement of their present situation and their expectations for the coming months both worsened.
"The threat of protectionism is dampening the mood in the German economy," Ifo president Clemens Fuest said in a statement, although companies' judgement of their present situation "nevertheless remained at a high level." Germany performed strongly in 2017, booking its most powerful economic expansion since 2011 as indicators like industrial output and employment sparkled.
But while the dashboard of Europe's largest economy remains largely green for now, the threat of US President Donald Trump slapping tariffs on steel and aluminium imports and sparking a transatlantic trade war has sapped the euphoric mood.
The ZEW institute's monthly sounding of confidence among German investors fell back even more sharply than Ifo's March reading earlier this week.