The economic sentiment indicator that indicates economic situation six months in advance, fell by 22.5 points to minus 37.6 in August, Mannheim-based ZEW Centre for European Economic Research said Tuesday. It was well below the historical average of 25.9 and the consensus forecast of minus 26. The situation in the U.S. coupled with weak German economic growth figure and the critical development in the euro area weighed on the the assessment of financial market experts.
Skepticism regarding future economic growth increased dramatically, said ZEW President Wolfgang Franz. "Besides, expectations are in line with the pessimism about economic growth prevailing on stock markets."
The survey conducted among 286 analysts between August 8 and 22 showed that the assessment of the current economic situation dropped by 37.1 points to 53.5 points, which was also below the expected reading of 85.
Economic expectations for the Eurozone decreased by 33 points to minus 40 points in August. At the same time, the indicator for the current economic situation slipped 21.4 points to minus 19.1 points.
Jennifer McKeown, an economist at Capital Economics said the survey suggests that there might be worse to come, which could further limit Germany's appetite for supporting the periphery. The 17-nation currency bloc expanded only 0.2 percent in the second quarter and the powerhouse of euro area, Germany grew merely 0.1 percent.
Today's flash Purchasing Managers' survey showed that German private sector growth moderated in August to the weakest since July 2009. The composite output index fell to 51.3. Finance Minister Wolfgang Schaeuble said on Monday in an interview with Deutschlandfunk radio that there are no signs of a recession in Germany. "The euro is stable despite the recent turbulence," he noted.
Read more at forex trade
No comments:
Post a Comment