German ZEW economic sentiment deteriorates further in February

Germany’s economic confidence worsened further as expectations were negatively impacted by the recent subdued economic data and political uncertainty. The ZEW Indicator of Economic Sentiment for Germany dropped 6.2 points to 10.4 in February 2017. The assessment of the current situation in the nation has dropped slightly. The index dropped 0.9 points to a still very high level of 76.4 points.

ZEW President Professor Achim Wamback stated that the downturn in expectations is possibly due to the recently published unfavorable prints for retail sales, industrial production and exports. Also the political uncertainty about Brexit, the future U.S. economic policy and the significant figure of the upcoming elections in Europe further depresses expectations.

“Nevertheless, the economic environment in Germany has not significantly worsened,” added Achim Wambach.

Meanwhile, the euro area’s financial market experts’ expectations about the economic development have dropped to a degree similar to those regarding Germany. The indicator has fallen 6.1 points to 17.1. The current economic situation indicator, on the other hand, rose 3.2 points to 2.8 in February. This is the first time in positive territory since July 2011.