With its decision to pause interest rate hikes, the ECB is providing exactly what businesses in Germany need most: reliability. Since the inflation rate aligns with the target, the relevant interest rates remain unchanged. This gives the economy a valuable breather, as financing costs also remain stable. Businesses now have the security they need to plan their investments.

If interest rates had been hiked due to slightly above-target inflation rates in Germany, it would have negatively impacted investment sentiment. Such an increase would have further hampered the already subdued willingness to invest.

Let’s be clear: a pause in interest rate hikes is not an economic stimulus program nor a substitute for structural reforms! Monetary policy has done its part by curbing inflation and taking the economic situation of businesses into account. The focus now shifts to economic and financial policy and the businesses themselves. It’s crucial to leverage the stability gained in financing conditions to enhance Germany's competitiveness through structural reforms. Our location needs increased investments in digitalization and infrastructure to achieve positive economic growth rates once again.