Eurozone Sentix Investor Confidence fell sharply again in September, dropping from -13.9 to -15.4, significantly below the expected -11.7. This marks the third consecutive month of declines and the lowest reading since January. The Current Situation Index also weakened, falling to -22.5, its lowest point since December 2023. Meanwhile, the Expectations Index offered a slight improvement, rising from -8.8 to -8.0, but it remains deep in negative territory.
Germany’s outlook painted an even bleaker picture. Investor confidence in Europe’s largest economy plunged from -31.1 to -34.7, its lowest point since October 2022. Current Situation Index dropped significantly from -42.8 to -48.0, reaching levels not seen since June 2020. Meanwhile, Expectations Index dipped further from -18.5 to -20.3, hitting its lowest since October 2023.
Sentix analysts described the situation as increasingly dire, stating that the German economy is approaching a new “climax” in its deepening recession. The report emphasized that the recession is “raging ever stronger,” with expectations continuing to fall, highlighting the “hopelessness” felt by investors.
The report also highlighted that the broader Eurozone is grappling with “dangerous recessionary tendencies,” driven largely by Germany’s economic struggles. The prospect of a more accommodative monetary policy is now the key hope for market participants, as the ECB is widely expected to announce another rate cut in its upcoming meeting this week.
