Germany’s ZEW Economic Sentiment index surged significantly to from 3.6 to 13.1 in October, surpassing market expectations of 10.2. However, Current Situation Index dropped further into negative territory, falling from -84.5 to -86.9, slightly worse than forecast of -85.0.
For the Eurozone, ZEW Economic Sentiment rose from 9.3 to 20.1, beating expectations of 16.9. Current Situation Index, however, saw a small decline, edging lower by -0.4 points to -40.8.
ZEW President Achim Wambach highlighted the mixed signals, noting that despite a very weak current economic situation in Germany, optimism is growing. He cited “stable inflation” expectations and the prospect of “further interest rate cuts” by ECB as key contributors to this improved outlook.
Wambach added that positive signals from key export markets such as the US, China, and the Eurozone also played a role in improving the outlook for Germany’s economy. China’s recent economic stimulus measures have contributed to this optimism too, boosting expectations for Germany’s exports.
