DE: ZEW Survey

Tue Aug 16 04:00:00 CDT 2016

Consensus Actual Previous
Current Conditions 47.7 57.6 49.8
Bus. Expectations 4.0 0.5 -6.8

The August ZEW survey shows greater satisfaction with current state of business but continued qualms about its future. The current conditions index more than recovered its July losses, gaining 7.8 points to 57.6, contrary to expectations of a small decline, and posting the highest level since January. The future expectations index, however, managed to regain only an insignificant 0.5 points of July's outsized 26-point drop.

Analysts and financial experts appear to be impressed by Germany's economic performance, but they remain worried about the post-Brexit future of Germany in such areas as trade, where it is more exposed to UK markets than some of the other Eurozone states.

The Mannheim-based Centre for European Economic Research (ZEW), asks German financial experts every month for their opinions on current economic conditions and the economic outlook for Germany (as well as other major industrial economies). The responses are synthesised into two simple indices that provide a snapshot of how the economy is seen to be performing.

The ZEW Indicator of Economic Sentiment is calculated from the results of the ZEW Financial Market Survey. The ZEW is followed closely as a precursor and predictor of the Ifo Sentiment Survey and as such is followed closely by market participants. The data are available the second week of the month for the preceding month. The survey provides a measure of analysts' view of current economic conditions as well as a gauge of expectations about the coming six months. The latter measure tends to have the larger market impact and reflects the difference between the share of analysts that are optimistic and the share of analysts that are pessimistic. About 350 financial experts take part in the survey.