German companies cut direct investment in the United States to €4.3 billion in the first half of 2026, the lowest level since 2023, according to calculations by the German Economic Institute based on Bundesbank data. The total was down nearly two-thirds from a year earlier and almost 80% from the first half of 2024, extending a steady decline since Donald Trump began his second term in January 2025. IW researcher Samina Sultan said companies are holding back on strategic new investments such as acquisitions and new operations, even as businesses already established in the U.S. continue to reinvest locally earned profits. That pattern suggests the U.S. market remains attractive, but firms are becoming more cautious about committing fresh equity capital amid tariff threats and deteriorating U.S.-EU trade relations. The first-half 2026 figure also remained far below the €15.8 billion average seen in the five years before the COVID-19 pandemic, underscoring how sharply investment appetite has weakened outside the exceptional conditions of the pandemic years. A DIHK survey showed only 41% of German companies with U.S. operations planned to raise capital spending there, below the long-term average. While direct investment data can swing on individual large transactions and may later be revised, IW said the broader trend of cooling German investment in the U.S. is clear.