German firms curb U.S. spending amid trade uncertainty, hitting three-year low
German companies reduced their U.S. investments to the lowest level in three years during the first half of 2026, citing concerns over unpredictable American trade policies.
In the early months of 2026, German businesses pulled back capital commitments in the United States, reaching a three-year trough. The pullback reflects worries about Washington's shifting trade stance under President Donald Trump. Similar caution appears in Europe, illustrated by Spain's recent cancellation of a Lockheed Martin F-35 purchase after a dispute over defense funding. While American firms represent a modest share of overall European investment, they dominate sectors such as information technology and defense, where supplier changes are complex and costly.
Why it matters
Reduced German investment signals growing mistrust of U.S. trade policy, potentially reshaping transatlantic economic relations.
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