In English it can it is normal to walk into somewhere and say "smells good" or "looking good" providing you are in an informal setting. Does German have an equivalent way of saying something like, without directly referring to the subject or what you are talking about. Would it be as simple as saying 'riecht gut!'? Or would there be a more idiomatic way to say this?
"Das sieht gut aus" or "Sieht gut aus" can be used, both in the literal sense ("I like the look of this") and in the sense of referring to future prospects ("I don't know for sure yet, but I feel this is going to end well").
I am only aware of "Das riecht gut" literally referring to an actual smell.
You can use the verb "duften", which by itself means "to smell good", so you don't even have to add the adjective "good". On the other hand, if it smells especially good you can say "Es duftet wundervoll!". You can also use this verb with "nach" to say what it smells of (e.g. "Es duftet nach Kaffee"), and you can specify where it smells good (e.g. "...in diesem Garten"). As far as I'm aware, there's no reason why you couldn't just walk into a room and say "Mmm, es duftet!", specifying neither what it smells of nor where specifically the smell is emanating from. However, in my experience people usually use it in reference to something specific that they already know to be the source of the smell (e.g. sitting at the dinner table as the lid is lifted from the soup...)