Slow improvement in economic outlook expected, with recovery late in second half
Investor confidence for Germany has risen in June as institutional investors increasingly expect economic growth to accelerate in the second half of the year despite the predicted Chinese economic slowdown and the ongoing European sovereign debt crisis, according to the ZEW Centre for European Economic Research.
The ZEW indicator for economic sentiment in Germany, Europe’s largest economy and a driver of continental growth, has risen by 2.1 points in June from May’s 38.5 score, according to the latest data. The results, which measure the outlook for the German economy until the end of November, mark a partial recovery from the declines registered earlier this year.
‘The financial experts stick to their assessment: the German economy is likely to pick up speed in the second half of 2013,’ says Clemens Fuest, president of ZEW. ‘But the results of the current survey indicate the economy will improve rather slowly. Almost half of the survey respondents expect no significant economic impulses in the next six months.’
The assessment of the current German economy has fallen 0.3 points to 8.6, with the European Central Bank (ECB) warning of an economic slowdown in the next few months. Germany’s GDP grew by just 0.1 percent in the first quarter of this year.
The ZEW indicator measures the six-month economic outlook for Germany, based on a survey of 257 analysts taken between June 3 and 17. The numbers represent the difference between the percentage of analysts with positive outlooks and those with negative outlooks.
The outlook for the eurozone as a whole has increased by three points to 30.6 as fears concerning the sovereign debt crisis and the ECB’s readiness to act have eased, according to ZEW. The assessment of the current situation in the zone, though, has dropped 2.7 points to negative 79.5.
Globally, the outlook for France registers the biggest improvement in the month, rising 9.1 points to 5.7, entering positive territory. The outlook for Italy comes second, with a seven-point increase to 15.2, followed by the US outlook, which has grown by 5.7 points to 51.8, the most positive outlook registered by ZEW.
As for the assessment of the current economic situation, Germany’s 8.6 is the only positive score. Italy posts the worst score, at minus 90.7, followed by France at minus 87.8, the UK at minus 65.1 and Japan at minus 30.1. The US assessment is barely negative, at minus 0.9 points.
