Due to international trade voltages and high raw material prices, German industry continues to face challenges, but remains robust overall. The US Federal Reserve’s US Federal Reserve signals an interest rate reduction this year, provided that inflation and labor market continue to stabilize. The Lufthansa share benefits from the strong start of the quarter of the US airline Delta and increasingly relies on margin offers. Volkswagen initially stops exporting his e-small pattern ID.Buzz to the USA due to high US criminal duties and technical recalls.
Global stock market – new record high at DAX®
On Thursday, the DAX® reached a new record high with 24,639 points-the 33rd in 2025. Statistically, most DAX® records arise in the first half of the year-only 38% fall into the second half of the year. On Friday afternoon, the DAX® noted around 2 percent above the pre -week closing course. The S&P 500® came on Thursday evening compared to the previous Thursday closing course. The Dow Jones Industrial Average® was around 0.4 percent below the pre -week course. The technology-based NASDAQ-100 Index® closed around 0.2 percent in the minus on Thursday evening in a week comparison.
Industry Germany – upward trend despite uncertainties
German industry recorded a surprisingly strong production plan of 1.2 %in May. The car, pharmaceutical and energy sectors in particular contributed to the positive development. Also in the three -month comparison (March – May) there is an increase of around 1.4 %. Despite the upswing, industrial production is still below the pre-crisis level of covid pandemic. However, economists see signs of sustainable recovery in the processing industry. The IFO Institute and other research institutes expect a moderate growth of around 0.3 %for 2025. US customs policy remains a risk factor for exports and the economy. Consumer mood also develops positively-the HDE barometer increases to 97.73 points. Consumption could contribute to the economic recovery in small steps. In addition, inflation drops to around 2.0 %in June. The federal government supports the upswing with economic stimulus programs. Construction production, on the other hand, declined in May. Overall, there is a cautious optimism for German industry.
US interest rates – hope for interest rate cuts
The conflict between US President Donald Trump and the US Federal Reserve continues. Trump has been demanding clear interest rate cuts for months and is apparently planning to replace Powell with a successor before the regular end of his term in May 2026. So far, the Fed itself is careful. The key interest rate remains with a range of 4.25 to 4.5 percent. Internal protocols show that a majority of central bank members in view of the uncertain inflation situation and the possible consequences of Trump’s customs policy are currently not supporting a rapid interest rate reduction. Nevertheless, there is the possibility of money -political loosening over the course of the year – provided that inflation remains under control and the labor market develops stable. The Fed also plans loosening at banking supervision. In the future, large banks should no longer lose their “well-run” status due to individual defects, but only if there are several weaknesses. The FED wants to react to the criticism that the current evaluation system is too strict and not practical. The aim is to make the rules more realistic and to avoid unnecessary restrictions for solid institutes.
Lufthansa – tailwind from the USA
The Lufthansa share closed on Thursday after strong figures from the US airline Delta Air Lines ensured new confidence in the industry. Even if the annual forecast was slightly reduced, stable summer bookings and a growing premium business convinced. This development also benefits Lufthansa. The company is in the middle of the strategic conversion to high -quality travel offers with a focus on business travelers and premium customers. Initial measures such as better seats, new lounges and digital services should strengthen profitability. Despite structural challenges – such as increasing costs, fluctuating demand and intensive competition – Lufthansa could benefit from stabilization in international air traffic. The premium segment is more resistant than the price -sensitive volume business. Business trips are also slowly increasing again, albeit at the pre -crisis level.
VW – Export of the E -Kleinbuss Id.buzz stopped to the USA
Volkswagen has stopped the export of his electrical tone buss ID.Buzz to the USA for the time being. The reason is the high US criminal tariffs on vehicles and components produced in Europe, which have been significantly increased to 27.5 percent since April. In addition, a technical recall due to problems with the rear seat bench led to an abrupt export stop in May. The shipped quantities fell from over 1,900 in the first quarter to just around 570 in the second quarter. VW CEO Oliver Blume no longer described the current export position to North America as economically. The entire German auto industry suffers from the high US tariffs, which could cause damage of over eleven billion euros this year alone. The industry is hoping for an early trade agreement between the EU and the USA, which at least lowers the tariffs. Various compromise models are discussed, including a clearing system for im- and exports or a quota regulation. However, a complete duty -free trade currently appears unrealistic. Whether and when the ID.Buzz will be delivered to the USA again depends largely on the development of customs policy. Local production of the e-bullis in the USA is currently not planned.
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Source: HSBC