| Consensus | Actual | Previous | |
|---|---|---|---|
| Current Conditions | -67.0 | -73.8 | -72.3 |
| Economic Sentiment | 50.0 | 47.5 | 47.1 |
Highlights
The German ZEW survey showed a modest improvement in economic sentiment in May but a deterioration in its measure of current economic conditions. The economic sentiment index rose from 47.1 in April to 47.5 in May yet fell short of the consensus forecast of 50.0. Nevertheless, this extends the upward trend seen in this index since mid-2023 and takes it to its highest level since February 2022. The current conditions index, however, fell from minus 72.3 in April to minus 73.8 in May, well below the consensus forecast for an increase to minus 67.0.
These moves in the survey resulted in the German RPI falling from minus 7 to minus 9 and the RPI-P falling from minus 8 to minus 10, indicating that German data are continuing to come in close to consensus expectations.
These moves in the survey resulted in the German RPI falling from minus 7 to minus 9 and the RPI-P falling from minus 8 to minus 10, indicating that German data are continuing to come in close to consensus expectations.
Market Consensus Before Announcement
Current conditions are expected to improve in June to minus 67.0 versus May's minus 72.3 which, though weak, easily beat the consensus. The report's expectations component (economic sentiment) is seen rising to 50.0 from May's 47.1 which, for the ninth month in a row, was also above the consensus.
Definition
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.
Description
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 around mid-month for the current 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.
