The SAFE Manager Sentiment Index fell slightly from -0.17 to -0.19 points in August. Thus, sentiment among executives of listed companies in Germany remains neutral. In financial reports, the tone declined from -0.85 to -1.05 points, which is likely related to the negative effects of US tariffs on second-quarter results. In earnings conference calls, however, many executives expressed greater confidence about their outlook (increase from +0.60 to +0.76 points).
“No one wants to go out on a limb at the moment,” says Florian Heider, Scientific Director of the Leibniz Institute for Financial Research SAFE. “There are still risks surrounding the EU's tariff agreement with the US. Many details remain uncertain.” Statements made by executives at earnings conference calls in July reflect this attitude, such as “We remain cautious” or “We think the sentiment improves, but we stay on alert mode.” Although the share of words expressing uncertainty in manager communication has fallen for the first time in four months, it remains high at 1.68 percent.
Restructuring brings optimism
Nevertheless, companies are also optimistic about the coming months, as restructuring measures are beginning to pay off: “Many companies are talking about more efficient processes that lower costs. It strengthens competitiveness,” says Alexander Hillert, Professor of Data Science and Finance at SAFE. “Given technological and geopolitical developments, companies will continue these processes to remain competitive.” One executive expects “increasingly positive effects from the consistent implementation of [their] cost programs and ongoing restructuring measures,” but also emphasizes that “growth has to continue and we even need to speed up the measures.” Another announced “leaner, less complex processes and structures” in administration and “sustainable cost savings.” Investments in technology also boost confidence: one company sees itself as “perfectly positioned” to benefit from the expansion of technological capabilities. Another sees opportunities in “very attractive segments” “where we can play our technology-leading position.”
Political environment with greater clarity, but unresolved issues
From the perspective of some executives, the federal government's budget planning leads to clearer framework conditions. The infrastructure package has received approval from various industries. An executive from the construction industry said: “[...] The €500 billion infrastructure investment package approved by the Bundestag parliament offers enormous opportunities to accelerate the modernization of the country.” Another company in the defense, electronics, and aviation sector is counting on higher defense spending: “[...] our confidence has only grown that germany’s [sic] 2025 defense budget will be approved right after the summer break.” However, as with the trade talks with the US, many details are still open and continue to cause uncertainty.
The SAFE Manager Sentiment Index
The SAFE Manager Sentiment Index measures the optimism or pessimism expressed by executives of listed companies in Germany monthly. Developed by Alexander Hillert and his team at the Leibniz Institute for Financial Research SAFE, the Index is based on automated text analysis that evaluates positive and negative statements in financial reports and analyst conferences. The Index is based on a three-month rolling window of data.
Since May 2025, the team has systematically measured uncertainty expressed in financial communication, using the Loughran and McDonald Dictionary of Uncertainty Words. This analysis captures uncertainty based on narratives – how often corporate leaders express ambiguity, risk, or doubt. In other words, it enables pinning down what top managers are uncertain about.
The future scheduled release dates for 2025 are:
- Tuesday, 9 September
- Wednesday, 8 October
- Tuesday, 11 November
- Tuesday, 9 December
