Germany Zew Economic Sentiment Index2021 Data | 2022 Forecast

The ZEW Indicator of Economic Sentiment for Germany dropped another 4.2 points from the previous month to 22.3 in October 2021, the lowest level since March 2020 when the COVID-19 pandemic hit Europe's largest economy, sending investor morale sharply lower. The reading came in also below market expectations of 24.0 and moved further away from an over 21-year high of 84.4 hit in May, suggesting the outlook for the economic development in the next six months deteriorated sharply due to the persisting supply bottlenecks for raw materials and intermediate products. Investors now expect profits to go down, especially in export-oriented sectors such as vehicle manufacturing and chemicals/pharmaceuticals. The assessment of the economic situation in Germany also declined more than expected in October, falling by 10.3 points to 21.6.

The ZEW Indicator of Economic Sentiment for Germany declined to 26.5 in September of 2021 from 40.4 in August, and below market forecasts of 30. The gauge fell for the 4th consecutive month to the lowest since March 2020 when the coronavirus crisis started. The assessment of the economic situation in Germany however, increased to 31.9 from 29.3 in August. Current readings imply that over the next six months economic growth in Germany will only be slightly higher than its current rate. “Expectations fell markedly once more in September 2021. Although financial market experts expect further improvements of the economic situation over the next six months, the expected magnitude and the dynamics of the improvements have decreased considerably. Global chip shortage in the automobile sector and shortage of building material in the construction sector have caused a significant reduction in profit expectations for these sectors”, comments ZEW President Professor Achim Wambach.

The ZEW Indicator of Economic Sentiment for Germany declined by 22.9 points to 40.4 in August of 2021, the lowest level since November and well below market expectations of 56.7. It was the third monthly decline in investor confidence, after reaching its highest level in two decades in May. About 51.1 percent of the surveyed analysts predicted an improvement in economic activity over the coming months, while10.7 percent of them expected it to get worse and 38.2 percent expected no changes. The assessment of the economic situation in Germany increased by 7.4 points to 29.3 in August. "This indicates increasing risks for the German economy, such as a possible fourth Covid wave from autumn or a slowdown in growth in China. The significant improvement in the assessment of the economic situation, which has persisted for months, shows that expectations are also weakening due to the higher growth already achieved, "commented ZEW President Prof. Achim Wambach, Ph.D. the current expectations.

The ZEW Indicator of Economic Sentiment for Germany dropped 16.5 points from the previous month to 63.3 in July 2021, the lowest level since January and below market expectations of 75.2. It was the second monthly decline in investor confidence, after reaching in May its highest level in two decades, but still suggesting that the overall economic situation will be extraordinarily positive in the coming six months. About 67.2 percent of the surveyed analysts predicted an improvement in economic activity over the coming months, while 3.9 percent of them expected it to get worse and 28.9 percent expected no changes. The assessment of the economic situation in Germany jumped by 31.0 points to 21.9 points in July, and was back in positive territory for the first time in two years.