| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Current Conditions | -85.0 | -88.0 to -85.0 | -86.9 | -84.5 |
| Economic Sentiment | 4.7 | -1.0 to 10.0 | 13.1 | 3.6 |
Highlights
The ZEW indicator for October shows a surprising rebound in economic sentiment for Germany, rising by 9.5 points to 13.1 after a previous decline. However, While sentiment has technically improved, it still remains fragile. Simultaneously, the assessment of the current economic situation worsened, dropping further to minus 86.9 points from minus 84.5, signalling deep concerns about the present state of the economy.
The report underscores the diminishing hope for a quick recovery, with optimism and pessimism now equally balanced. Even though the market has largely factored in the ECB's recent interest rate decisions, pessimism in Germany persists. The situation indicator also worsened to minus 40.4 points, highlighting deteriorating conditions. In the Eurozone, economic sentiment dropped by 8.6 points to 9.3, indicating broader regional challenges.
Overall, the report paints a still subdued picture. That said, the RPI (21) and RPI-P (24) at least show economic activity performing better than expected.
The report underscores the diminishing hope for a quick recovery, with optimism and pessimism now equally balanced. Even though the market has largely factored in the ECB's recent interest rate decisions, pessimism in Germany persists. The situation indicator also worsened to minus 40.4 points, highlighting deteriorating conditions. In the Eurozone, economic sentiment dropped by 8.6 points to 9.3, indicating broader regional challenges.
Overall, the report paints a still subdued picture. That said, the RPI (21) and RPI-P (24) at least show economic activity performing better than expected.
Market Consensus Before Announcement
Germany's current economic situation index is expected to remain depressed at minus 85.0 after falling to a dismal minus 84.5 in September.
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.
