DE: ZEW Survey

Tue Oct 17 04:00:00 CDT 2017

Consensus Actual Previous
Current Conditions 88.5 87.0 87.9
Bus. Expectations 23.0 17.6 17.0

ZEW's October survey suggests that analysts' view of the overall German economic situation has hardly changed since September. A minor fall in the assessment of current condition was offset by a slight improvement in the (more important) expectations component.

Current conditions slipped from 87.9 to 87.0. This was their first decline since July but made little impact on what remains a very solid reading historically. By contrast, expectations gained 0.6 points to 17.6, a second successive rise after a string of declines from June to August, but small enough to leave the measure 3 points below May's recent high.

Although not very well correlated, the ZEW's latest findings point to broadly stable October Ifo and flash PMI reports next week.

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.