The US budget freeze was a key topic at recent earnings conference calls held by listed companies in Germany. Export-oriented companies in particular observe risks from reluctant customers and postponed orders.
“Companies are wondering whether they will lose profitability in light of the situation in the US,” says Alexander Hillert, Professor of Finance and Data Science at the Leibniz Institute SAFE. The shutdown of the US government could have a negative impact on consumer behavior and delay business with the government entities in particular.
Executives emphasized that “discussions about the current government shutdown have been impacting buying behavior in the US way before the shutdown started,” that the shutdown “is impacting customers' willingness to invest,” and that it was causing “high nervousness” in some industries.
“The longest shutdown in US history has caused more concern for many German companies than semiconductor shortages that have also been discussed,” says Hillert. For example, a manager at an automotive manufacturer said that the current shortages “have no impact on production.” Supply chains have become more stable since the last chip crisis. It is also clearer which semiconductors are needed for which components and models, mitigating the impact.
SAFE Index rises slightly
Despite global uncertainties, sentiment among executives remains stable: “The SAFE Index remains in neutral territory,” explains Florian Heider, Scientific Director at the Leibniz Institute SAFE. In November, the Manager Sentiment Index rose slightly from -0.40 to -0.31 points.
“Executives keep an eye on risks but are not succumbing to pessimism. Many report a good third quarter and are cautiously optimistic about the coming months,” says Heider. This assessment is supported by statements from earnings conference calls such as: “Our growth strategy... is paying off” or “We are on track to reach or exceed our strategy execution targets.” Some executives expect the situation to remain unchanged: According to one manager, there is “no real negative or positive development right now.” Another executive said that a slowdown at the end of the year is not cause for concern and “is nothing unusual.”
“The overall picture, which has hardly changed, is also reflected in the SAFE Manager Sentiment Index: between September and November, the index barely moved,” adds Hillert.
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 earnings calls. 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. It enables pinning down what top managers are uncertain about.
The future scheduled release dates for 2025 are:
- Tuesday, 9 December
