Germany

Germany is witnessing a significant rise in corporate bankruptcies, with 2024 marking a 22.4% increase in insolvency filings compared to the previous year, the Munich Eye reported. This surge has raised concerns among experts, with predictions of an impending wave of insolvencies in 2025 potentially surpassing those seen during the financial crisis of 2009. According to the Federal Statistical Office, February alone saw a 12.1% increase in bankruptcy filings compared to the same month in the previous year.

The European Central Bank has given UniCredit (CRDI.MI), opens new tab the green light to buy up to 29.9% of Commerzbank (CBKG.DE), opens new tab, the Italian bank said, adding it would likely wait until next year before deciding whether to pursue a full takeover, Reuters reported. With Germany up in arms against the potential acquisition, UniCredit's CEO Andrea Orcel, a veteran dealmaker, has thrust his bank into fast-moving Italian consolidation and put on ice his ambitions for a pan-European tie-up.

The German women's fashion brand Gerry Weber filed for insolvency with a court in western Germany on Tuesday and is seeking to once again undergo restructuring, DPA International reported. The aim of the proceedings is to continue the company as a going concern. Lucas Flöther has been appointed as administrator for the insolvency, according to the company. A new owner is now being sought and dpa has learned that initial talks are already under way. The company employs just under 230 people in Germany.

Industrial production in Germany showed tentative signs of improvement at the start of the year, though that could be threatened by potential U.S. trade tariffs, the Wall Street Journal reported. Output increased 2.0% on month in January, German statistics agency Destatis said Monday, compared with a 1.5% decline in the final month of 2024. Economists polled by The Wall Street Journal expected a 1.5% increase in January. There are signs the industrial recession of recent years is fading.

Germany’s embattled manufacturing industry faces a fresh slump after new orders plunged by 7pc between December and January, The Telegraph reported. Machinery orders dropped more than 10pc on the month, while “other transport equipment” – the category including planes, ships, trains and military vehicles – plunged by almost 18pc. Consumer goods also slid 2pc.

The two political parties expected to form the next German government have agreed to loosen the country's constitution restrictions on borrowing, enabling 1 trillion euros ($1.08 trillion) or more in spending on defense and infrastructure, the Associated Press reported. It’s a major change in Germany’s debt-averse political culture, rejecting conventional economic wisdom that long dominated Europe’s biggest economy and one of the world’s wealthiest countries.

Germany should loosen constitutional borrowing limits to free up as much as €220 billion ($232 billion) of fiscal space through 2030 to boost infrastructure and military spending, according to the Bundesbank, Bloomberg News reported. In a report Tuesday discussing options for the country’s so-called debt brake, it recommends significantly higher ceilings of as much as 1.4% of gross domestic product for structural net borrowing — primarily to fund investment.

German inflation unexpectedly remained unchanged in February, highlighting the challenges for the European Central Bank in deciding how quickly and how far to cut interest rates, Bloomberg News reported. Consumer prices increased 2.8% from a year ago, the statistics office said Friday. Economists in a Bloomberg survey had expected a slight slowdown to 2.7%. The report follows earlier figures showing French inflation retreated to its lowest level in four years, while price gains in Italy surprisingly held steady.

Germany’s jobless rate held steady in February, a sign that recent workforce reductions announced at some major companies hasn’t yet significantly dented employment, the Wall Street Journal reported. The adjusted unemployment rate in Europe’s largest economy was 6.2% this month, the same as in January, according to data from Germany’s Federal Employment Agency published on Friday. Meanwhile, jobless claims ticked up by 5,000 in February, albeit slowing from the 11,000 of January. Registered job vacancies stood at 639,000, some 67,000 fewer than the same point last year.

UniCredit has asked German antitrust authorities to approve its move to take a substantial stake in Commerzbank, another key hurdle for the Italian bank to overcome as it pursues a possible takeover of the German lender, Reuters reported. UniCredit has built a web of financial transactions to secure a Commerzbank stake of just under 30%, putting it on the cusp of a full-blown takeover of one of the most important lenders to Germany's small and medium-sized Mittelstand companies.