FRANKFURT – German financial market experts expressed more optimism about coming months but less about the present in Europe’s largest economy as worries about growth remain at the forefront.
The ZEW economic thinktank said Tuesday that its October expectations indicator for the coming half-year rose to 13.1 points, its first improvement in four months. The measure was still the second-lowest since January after increasing from 3.6 last month to beat the market forecast of 10.0.
The current conditions measure eased to -86.9, again its worst since May 2020, to fall short of the -84.0 estimate and the -84.5 result from last month. The ZEW said the survey showed “almost nine out of ten respondents assessing the current economic situation as negative.”
The expectations index for the Eurozone rose to 20.3 points from 9.3 in September.
EUR/USD remained above 1.09 shortly following the report after slipping below the mark earlier in the session. The Dax 40 index of German blue chips continued lower on the news.
Help from outside the country
Source: ZEW
ZEW President Achim Wambach said an array of factors underpinned the improved outlook, including “the expectation of stable inflation rates and the associated prospect of further interest rate cuts by the ECB. Positive signals are also coming from Germany’s export markets.”
He cited improved economic expectations for the Eurozone, the US, and China as further assistance. “The increased optimism for China is likely linked to the Chinese government’s economic stimulus measures. These developments have probably also contributed to the rise in economic expectations for Germany.”
His summation followed a similar view from German pollster Sentix last week, when its investor sentiment index for the country increased to -31.5 points from -34.7 in September. “The improved outlook is based exclusively on global stimuli from the world economy,” Sentix said. “The latest growth momentum in China in particular is having an impact on expectations in Germany.”
And with lower Eurozone borrowing costs likely in the pipeline for Thursday and December thanks to weaker-than expected inflation last month, investors may have more reason for optimism.
But it will be a hard go, according to Oxford Economics. “The expectations component recorded a sizeable jump, which went beyond our and consensus expectations for a more moderate rebound,” the group said in a note. “This follows three months of consecutive decline and because recent falls have also been quite marked, there is still some way to go until late-Q2 levels of sentiment are recovered. Moreover, hopes of an imminent pick-up are further tamed by still deteriorating current conditions, though the October drop was very marginal.
“We expect continued sluggish growth in the near-term with the recovery set to gather some momentum only next year.”
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postMessage({ action: 'CheckChannelStatusReponse', stream_status: data.stream_status.status, onair: data.stream_status.onair, connected: data.stream_status.connected });
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data_array.current_page = data.current_page;
data_array.php_session_id = data.php_session_id;
data_array.from_react = data.from_react;
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socket.send(msg_string); }
postMessage({action: 'PublisherChannelJoined' });
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function session_static_info(msg) {
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socket = new WebSocket("wss://ws.livesquawk.com/ws"+distributor_server);
socket.onopen = function(event) { request_server_assignment(); };
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function session_info_interval() {
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logging_interval = setTimeout(session_info_interval,logging_interval_time);
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function server_assignment_response(data) {
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socket.close();
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case 'calendar_insert':
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postMessage({ action: 'LSSocketConnectionError' });
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socket.onerror = function(event) {};
socket.close(1000);
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postMessage(data);
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session_info_interval();
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session_info.browser_name = data.browser_name;
session_info.user_agent = data.user_agent;
session_info.browser_version = data.browser_version;
session_info.cookies_enabled = data.cookies_enabled;
session_info.platform = data.platform;
session_info.player_version = data.player_version;
session_info.stream = data.stream;
session_info.connection_protocol = data.protocol;
session_info.delay_target = data.delay_target;
session_info.session_email = data.session_email;
session_info.remote_ip = data.remote_ip;
session_info.php_session_id = data.php_session_id;
session_info.application_name = data.application_name;
session_info.http_referrer = data.http_referrer;
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function start_log() {
var session_start_date = new Date();
session_start_time = session_start_date.getTime();
var months = ['Jan','Feb','Mar','Apr','May','Jun','Jul','Aug','Sep','Oct','Nov','Dec'];
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data_array.username = session_info.session_email;
data_array.php_session_id = session_info.php_session_id;
data_array.webrtc_protocol = '';
data_array.session_start_time = (session_start_time/1000).toFixed(0);
data_array.stream_name = session_info.stream;
data_array.session_start_date = session_start_date_string;
var msg_string = JSON.stringify(data_array);
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function update_session_info(data) {
var data_array = {};
var msg_string = '';
var current_date = new Date();
var current_time = current_date.getTime();
session_info.protocol = data.protocol;
session_info.curr_delay = (data.effective_latency / 1000).toFixed(2);
session_info.session_length = current_time - session_start_time;
session_info.ping_time = data.ping_time;
session_info.jitter = data.jitter;
session_info.packet_loss = data.packet_loss;
session_info.effective_latency = data.effective_latency;
session_info.mean_opinion_score = data.mean_opinion_score;
session_info.restarts = data.restarts;
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data_array.stream = session_info.stream;
data_array.restarts = session_info.restarts;
data_array.delay_target = 0;
data_array.op_sys = '';
data_array.flash_version = '';
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data_array.http_referrer = session_info.http_referrer;
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data_array.user_email = session_info.session_email;
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data_array.ping_time = session_info.ping_time;
data_array.jitter = session_info.jitter;
data_array.packet_loss = session_info.packet_loss;
data_array.effective_latency = session_info.effective_latency;
data_array.mean_opinion_score = session_info.mean_opinion_score;
data_array.session_id = session_info.session_id;
msg_string = JSON.stringify(data_array);
if (socket.readyState == 1) { socket.send(msg_string); }
}
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data_array = {};
data_array.type = 'webrtc_log_data';
data_array.session_id = session_info.session_id;
data_array.php_session_id = session_info.php_session_id;
data_array.connection_protocol = session_info.protocol;
data_array.restarts = session_info.restarts;
data_array.threshold = 0;
data_array.curr_delay = session_info.curr_delay;
data_array.session_length = session_info.session_length;
data_array.date = current_time;
data_array.webrtc_protocol = session_info.protocol;
data_array.ping_time = session_info.ping_time;
data_array.jitter = session_info.jitter;
data_array.packet_loss = session_info.packet_loss;
data_array.effective_latency = session_info.effective_latency;
data_array.mean_opinion_score = session_info.mean_opinion_score;
data_array.stream = session_info.stream;
msg_string = JSON.stringify(data_array);
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}
socket_emits++;
if (socket_emits == 100) { socket_emits = 0; }
}
- Current conditions lowest since May 2020
- Expectations second-worst since January
- Overseas developments, ECB policy boost mood
By Eric Culp, European Editor
LiveSquawk News
@EricCulpLS
15 October 2024 | 10:00 GMT
FRANKFURT – German financial market experts expressed more optimism about coming months but less about the present in Europe’s largest economy as worries about growth remain at the forefront.
The ZEW economic thinktank said Tuesday that its October expectations indicator for the coming half-year rose to 13.1 points, its first improvement in four months. The measure was still the second-lowest since January after increasing from 3.6 last month to beat the market forecast of 10.0.
The current conditions measure eased to -86.9, again its worst since May 2020, to fall short of the -84.0 estimate and the -84.5 result from last month. The ZEW said the survey showed “almost nine out of ten respondents assessing the current economic situation as negative.”
The expectations index for the Eurozone rose to 20.3 points from 9.3 in September.
EUR/USD remained above 1.09 shortly following the report after slipping below the mark earlier in the session. The Dax 40 index of German blue chips continued lower on the news.
ZEW President Achim Wambach said an array of factors underpinned the improved outlook, including “the expectation of stable inflation rates and the associated prospect of further interest rate cuts by the ECB. Positive signals are also coming from Germany’s export markets.”
He cited improved economic expectations for the Eurozone, the US, and China as further assistance. “The increased optimism for China is likely linked to the Chinese government’s economic stimulus measures. These developments have probably also contributed to the rise in economic expectations for Germany.”
His summation followed a similar view from German pollster Sentix last week, when its investor sentiment index for the country increased to -31.5 points from -34.7 in September. “The improved outlook is based exclusively on global stimuli from the world economy,” Sentix said. “The latest growth momentum in China in particular is having an impact on expectations in Germany.”
And with lower Eurozone borrowing costs likely in the pipeline for Thursday and December thanks to weaker-than expected inflation last month, investors may have more reason for optimism.
But it will be a hard go, according to Oxford Economics. “The expectations component recorded a sizeable jump, which went beyond our and consensus expectations for a more moderate rebound,” the group said in a note. “This follows three months of consecutive decline and because recent falls have also been quite marked, there is still some way to go until late-Q2 levels of sentiment are recovered. Moreover, hopes of an imminent pick-up are further tamed by still deteriorating current conditions, though the October drop was very marginal.
“We expect continued sluggish growth in the near-term with the recovery set to gather some momentum only next year.”
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