| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Current Conditions | -74 | -75 to -66 | -76.4 | -68.6 |
| Economic Sentiment | 25.7 | 15 to 36 | 37.3 | 34.7 |
Highlights
The latest ZEW survey results for Germany present a mixed picture of economic sentiment. The current conditions index fell sharply to minus 76.4 in September, down from minus 68.6 in August and weaker than the consensus forecast of minus 74. This decline signals that the economic environment is deteriorating more than anticipated.
In contrast, the economic sentiment index improved strongly, rising to 37.3 from 34.7 previously. This outcome not only exceeded the consensus estimate of 25.7 but also surpassed the upper bound of the forecast range (15 to 36). The improvement suggests analysts are more optimistic about Germany's economic outlook over the next six months, despite ongoing weakness in the current situation.
Overall, the survey reflects a sharp divergence with current conditions continuing to worsen. Still, expectations for the future are strengthening, implying cautious optimism that Germany may stabilise or recover in the months ahead. These updates take the German RPI to minus 11 and the RPI-P to minus 13, meaning that economic activities are underperforming in Germany.
In contrast, the economic sentiment index improved strongly, rising to 37.3 from 34.7 previously. This outcome not only exceeded the consensus estimate of 25.7 but also surpassed the upper bound of the forecast range (15 to 36). The improvement suggests analysts are more optimistic about Germany's economic outlook over the next six months, despite ongoing weakness in the current situation.
Overall, the survey reflects a sharp divergence with current conditions continuing to worsen. Still, expectations for the future are strengthening, implying cautious optimism that Germany may stabilise or recover in the months ahead. These updates take the German RPI to minus 11 and the RPI-P to minus 13, meaning that economic activities are underperforming in Germany.
Market Consensus Before Announcement
Current conditions expected even worse at minus 74 in September versus an already dismal minus 68.6 in August. Economic sentiment is seen at 25.7 in September versus 34.7 in August.
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.
