Category: 3. Business

Sentiment across major German businesses held steady at 87.6 points, according to the January edition of the monthly Ifo index. 

Some analysts had predicted a slight rebound in the Munich-based foundation’s survey of around 9,000 business leaders but the overall figure was ultimately unchanged.

“Assessments of the current situation edged up somewhat, while expectations were revised slightly downward,” Ifo Institute President Clemens Fuest said. “The German economy is starting the new year with little momentum.” 

Germany’s economy has been struggling in recent years, with only marginal GDP growth of 0.2% in 2025, according to provisional figures, and similarly marginal negative growth figures in the two previous years. Chancellor Friedrich Merz flagged improving the situation as a key goal for 2026 in his New Year’s speech.

Sharp increase in struggling manufacturing sector, services slip

Ifo’s Fuest reported that the index increased “sharply” in the particularly hard-hit manufacturing sector. 

“Companies assessed current business conditions as more positive. Their expectations were also notably less pessimistic,” he said. “However, capacity utilization fell from 78.1 to 77.5%, remaining below the long-term average of 83.2%.”

Meanwhile, the institute found a deteriorating climate in the services sector, both in terms of the curent situation and the perceived outlook. Ifo also said that the “climate also cooled noticeably in tourism.” 

The trade- and construction-specific indices also rose. Both retail and wholesale trade rebounded but “remain well below their long-term averages,” according to Fuest.

Germany’s central bank estimates that the slow pace of growth will continue in the first quarter of 2026, with economists forecasting 1% growth for the year as whole.

Edited by: Wesley Dockery

Corporations, trade groups and other stakeholders have until Jan. 31 to comment on the Greenhouse Gas Protocol’s controversial proposed changes to the methodology for calculating emissions related to electricity.

The deadline was originally Dec. 19, but the organization extended the public consultation period to accommodate more feedback.

The revisions, which would take effect in 2027, suggest major changes to how companies will be able to claim emissions reductions related to virtual power purchase agreements and other contracts they use to match their electricity consumption with renewable electricity sources.

This is the first major refresh since the methodology was adopted in 2014.

New math

Under the proposed update, corporations will be required to match those loads on an hourly basis using renewable resources on the same grid as their original power consumption. These calculations fall under the Scope 2 category for greenhouse gas emissions. 

“This is intended to reduce double counting and ensure reported clean energy purchases more accurately reflect the physical realities of the power grid,” Greenhouse Gas (GHG) Protocol said in October, when it opened the public consultation. 

The organization may include exemptions for smaller organizations. It is also considering a clause that would exempt legacy contracts signed before the new rules take effect. It’s particularly interested in comments related to those items.

GHG Protocol is also soliciting comments about a methodology that covers “consequential” accounting methods that guide how companies can report on projects that add renewable power to electric grids that are fossil fuel-heavy but aren’t in the same location as their operations.

Some companies with active renewable energy goals invest in projects of this nature, such as Salesforce and Microsoft, mainly for their social benefits and community goodwill.

More complexity

Corporate energy buyers expect the proposed modifications to complicate the process of making Scope 2 reduction claims.

“From my perspective, everything needs to be evaluated through one specific lens, and that is, Are the rules successfully encouraging more clean energy on the grid to most effectively tackle climate change?” said Bob Redlinger, director of energy and global sustainability at Apple, during a recent webinar discussing the changes. “And from that lens, the current rules have been very successful. I think that’s the lens from which any new rules or proposed changes also need to be examined.”   

Contracts by companies with emissions reduction commitments have added (or will add when complete) close to 128 gigawatts of renewable or clean energy to the U.S. electric grid from 2014 through November 2025, according to data collected by the Clean Energy Buyers Association, which takes issue with the hourly matching proposal.

While some regions of the U.S. grid have abundant clean energy resources, many other places do not.

The new rules could have the unintended impact of making it not economical and overly complex for some companies to continue making voluntary renewable energy purchases, Redlinger said: “I worry that with the GHG Protocol’s proposal to seek hourly matching for individual organizations and with very narrow geographic boundaries, it could actually slow the progress of decarbonization.”

What’s next

After the public consultation closes, GHG Protocol will analyze the comments and produce a summary. The organization’s governance rules suggest that this analysis may be published on its website, along with specific feedback — although some companies requested a chance to comment anonymously.

After the review period, the technical working group and independent standards board responsible for the methodology will consider modifications. 

Another draft of the updated rules will be published in 2026, followed by another 60-day public consultation period. A final version of the revised methodology is due in 2027.

Ryanair would be open to using Elon Musk’s Starlink wifi on its planes in the future, its finance chief has suggested, amid a feud between the boss of the Irish airline and the world’s richest person.

The airline would look at “whoever is the best, when the tech and price is right” for in-flight wifi, the Ryanair chief financial officer, Neil Sorahan, said.

Sorahan was speaking after an online spat between Ryanair boss Michael O’Leary and Musk, after O’Leary was asked whether he would follow Lufthansa and British Airways in installing Starlink satellite internet technology on his fleet of 650 aircraft.

The chief executive rejected the idea, saying that adding antennas to the jets would result in a “2% fuel drag”, adding an extra $200-250m to its $5bn (£3.66bn) annual kerosene bill.

Musk said the interpretation was “misinformed” in a post on his X platform, triggering a tit-for-tat exchange of insults, with each man calling the other an “idiot”.

Sorahan said the spat was “good fun” and had brought more people to the Ryanair website. O’Leary said last week that his quarrel with Musk had increased bookings by between 2% and 3%, after the company pushed a “big idiot sale” campaign poking fun at the Tesla chief executive, estimated to be worth $788bn by Forbes.

However, Sorahan added that in-flight wifi was still a long way away for Ryanair. “I have been looking at wifi for as long as I have been at Ryanair,” said the executive, who joined the airline in 2003. “There is still a fuel cost that we would have to absorb.”

There are concerns passengers may be less willing to pay for wifi on Ryanair’s short-haul flights, which typically only take between one and three hours.

The airline, which has grown to become the biggest in Europe, raised its forecasts for passenger numbers, profit growth and fares on Monday. It now expects to carry 216 million passengers by March 2027, and said average fares this year would rise by 7% to 8%, compared with previous guidance of 7%. Average fares rose 4% to €44 (£38) in its third quarter to the end of December.

Its profit after tax fell 22% to €115m in the third quarter, excluding a provision of €85m for a fine from the Italian competition authority, which the company said it was appealing against. However, it expects profit after tax between €2.13bn and €2.23bn for its full year.

The airline said Boeing deliveries were progressing well compared with a year ago when the aircraft supplier struggled to deliver jets on time. It said the final four Max 8 models would be delivered by the end of February, while the newer Max 10 would join the Ryanair fleet in spring 2027.

Shares in Ryanair, which are listed in Dublin and New York, dropped 1.7% in early European trading on Monday. They rose by more than 50% over the course of last year.

With property catastrophe reinsurance rates significantly softening at the January 2026 renewals, rating agency Fitch forecasts that further softening will continue into the April, June, and July renewals later this year.

At the same time, the agency confirmed that it is maintaining its ‘deteriorating’ sector outlook for global reinsurance in 2026, citing moderately weaker operating and business conditions expected over the year.

Fitch adjusted its outlook for the global reinsurance industry to “deteriorating” from “neutral” back in September, with the agency saying at the time that “Softer pricing conditions and rising claims costs will pressure underwriting margins, though profitability remains strong by historical standards.”

Analysts at Fitch recently highlighted how record amounts of reinsurance capital supply from both traditional and alternative sources exceeded the slight demand increase from buyers during the January 1, 2026 renewals, which drove a softening market, but one that analysts feel can still deliver profits.

“Property catastrophe pricing significantly softened at the January 2026 reinsurance renewals following rate reductions at the mid-year 2025 renewals, with reductions in risk-adjusted prices across most lines,” Fitch said.

Rate reductions of up to 5% were observed for US and European catastrophe-exposed portfolios, while for loss-free US property business, pricing declines reached as much as 20%, compared with a range of down 10% to up 10% from the previous year.

Additionally, European property rates also fell by up to 20% for loss-free accounts at the January renewals, versus a range of down 15% to up 5% in 2025.

As mentioned, the rating agency expects to see these softening conditions continue throughout 2026.

“We anticipate softening market conditions to continue at the midyear 2026 renewals in April (Asia-focused) and June/July (Florida). Abundant capacity and rising competition are likely to lead to gradual price erosion across most reinsurance lines and looser policy terms in property lines, barring large loss activity,” Fitch explained.

Fitch also outlined that competitive behaviour remains rational and disciplined, with loss ratios continuing to benefit from favourable claims frequency trends.

Moreover, while severe hurricane-related events and other natural catastrophe losses remain a key source of volatility for P&C insurers, Fitch Ratings believes the sector is well capitalised to withstand large single-event losses.

However, the agency warned that a series of major catastrophic events occurring in quick succession could strain capital positions and result in adverse rating consequences.

“Fitch has a ‘neutral’ fundamental sector outlook for the US property/casualty (P&C) insurance sector in 2026, as well as for both commercial and personal lines. Our ‘deteriorating’ outlook for the global reinsurance sector for 2026 reflects that underlying operational and business conditions are likely to worsen overall for reinsurers globally,” Fitch concluded.

Suspected Japanese intervention to sell USD/JPY has come at a weak time for the dollar after last week’s geopolitical fracturing. From what we understand so far, Japanese authorities may have intervened on Friday when USD/JPY pushed above 159 after the Bank of Japan policy meeting. The big kicker, however, was widespread discussion that at the London close at 17:00 GMT on Friday, the Federal Reserve started asking banks in New York about their position sizes in USD/JPY. This was seen as akin to a ‘rate check’, where a central bank might be preparing the market for physical intervention. That the Fed was allegedly doing this and not making clear that this activity was purely on behalf of Japanese authorities – i.e., that the Fed was not acting purely as an ‘agent’ – has led to understandable suggestions that the US might be on the verge of joint intervention with Japan. This is something we discussed in this month’s FX Talking.

The prospect of bilateral Japan-US intervention is understandably a more powerful one than mere passive intervention from Tokyo alone. Why would Washington want to get involved? We see two reasons: a) the weak yen was adding to last week’s JGB sell-off and indirectly driving US Treasury yields higher. If there is any financial instrument more important than the stock market to the White House right now, it is US Treasuries. And b) the strong USD/JPY was potentially unwinding the work of US tariffs on Japan and giving Japanese manufacturers a competitive advantage.

However, this is not a fundamentally driven move. Yen real interest rates are still negative, and the snap Japanese election on 8 February could still see more pressure emerge on JGBs and the yen. And away from the geopolitical risk premium being attached to US assets, the dollar’s fundamental story has not deteriorated. Plus, we suspect this week’s FOMC meeting could prove slightly dollar bullish.

No doubt, Japanese and potentially US authorities, too, like this constructively ambiguous approach to FX intervention. Traders will be bracing for activity at both market opens and closes now. An upside gap in USD/JPY at 155.65 may now prove intraday resistance. But for the dollar sell-off to continue like this, we will probably need to see some poor domestic US news. Away from the FOMC, this will heighten scrutiny on earnings releases from US Big Tech this Wednesday and Thursday.

This yen intervention story has weighed heavily on DXY, where the prospect of up to $100bn of sales (that’s what Tokyo sold in summer 2024) has caught the dollar at a weak moment. DXY has an upside gap to 97.42 (now resistance) and has a bias to last year’s lows at 96.20/35 – but really needs some fundamental backing for these moves to sustain.

Chris Turner

Bruce Richards, Co-Founder of Marathon, said: “For 28 years, Marathon’s unwavering mission is to deliver exceptional investment performance for clients through our robust origination platform, rigorous investment approach, deep specialization, and disciplined risk-management. CVC’s focus on delivering exceptional investment returns, integrity, collaboration, and client partnership closely aligns with Marathon’s culture. CVC’s global reach and its investment insights across multiple asset classes and geographies will deliver a powerful partnership, and we greatly look forward to growing our world class credit platform together with CVC.”

The $1.2 billion closing consideration comprises $400 million in cash and up to $800 million in CVC equity². The transaction also includes earn-out consideration linked to Marathon’s future financial performance over the period from FY2027 to FY2029, of up to $200 million in cash and $200 million in CVC equity².

The acquisition is expected to be EPS neutral in 2027 and EPS accretive from 2028 onwards, before any revenue or cost synergies.

Bruce Richards and Lou Hanover will continue to co-head the Marathon credit strategies, and Marathon will be re-branded CVC-Marathon.

Bruce Richards will join the Partner Board of CVC, and alongside Andrew Davies, will be responsible for managing the combined CVC Credit business. 

The transaction is subject to regulatory and other consents and is expected to close in Q3 2026.  Advisers to CVC included JP Morgan, Freshfields, Fried Frank and Ernst & Young. Advisers to Marathon included Sidley Austin.

Transaction details

CVC will acquire 100% of Marathon in a cash and equity transaction with a base consideration valued at up to $1.2 billion, comprising consideration at closing of $400 million in cash and up to 45 million units of equity to be issued by a wholly-owned subsidiary of CVC (“SubCo Units”), exchangeable on a one-for-one basis into CVC ordinary shares, subject to customary completion accounts adjustments and, in respect of 11 million SubCo Units, FY 2027 Marathon financial performance adjustments.  

The transaction also includes earn-out consideration linked to Marathon’s future financial performance over the period from FY 2027 to FY 2029, of up to $200 million of cash and 11 million SubCo Units. The earn-out consideration is only payable to Marathon’s partners and employees, increasing long-term alignment and continuity across a broader group. Marathon’s minority partner will receive $280 million of the cash consideration portion of the transaction for 100% of their interest in Marathon.

CVC ordinary shares issued in exchange for any SubCo Units will be held subject to substantially the same lock-up restrictions entered into by CVC’s current and former employees (and permitted transferees) as part of CVC’s IPO in April 2024. The cash portion of the transaction will be funded from CVC’s current cash on balance sheet and undrawn credit facilities.

 

^{1 As at 30 September 2025.}

^{2  The CVC equity will be issued by a wholly-owned CVC subsidiary and will be exchangeable on a one-for-one basis into CVC ordinary shares.}