Assessment of current state of economy jumps, indicating increasing optimism for 2014
Investor optimism in the German economy hovers near a seven-year high in January, indicating steady confidence in economic improvement for 2014.
The ZEW indicator for economic expectations in Germany over the next six months is holding at 61.7 points in January, marking only a slight decline from December’s 62 points – the highest level since April 2006, before the global financial crash.
At the same time, investors’ and analysts’ assessment of the current state of Germany’s economy, the driver of European growth, has jumped 8.8 points to 41.2, giving it the highest rating of any national economy tracked by the ZEW.
‘For months, the surveyed financial market experts have expected an economic upswing,’ says Clemens Fuest, president of ZEW, in a statement accompanying the January data. ‘In this month’s survey the clearly improved assessment of the current economic situation seems to confirm these expectations.’
Expectations for the eurozone as a whole have risen in January by five points to 73.3 as investors and analysts increasingly say the region is over the worst of its economic troubles. The assessment of the current state of the zone’s economy is up 6.2 points but remains in negative territory at minus 48.2.
Six-month expectations for the economy of France show the biggest improvement of all nations tracked by the ZEW, gaining 8.8 points in January to 28.7. At the same time, the assessment of the current state of the French economy has risen 1.2 points to minus 76.7 points. Despite the improvement, the figure gives France the second-worst assessment, behind Italy’s negative 78.7 points.
Opinions of the current state of the US economy show the sharpest improvement of all nations measured, increasing 18.8 points to 30.4 amid macroeconomic signs the recovery has gathered pace. Optimism over the US economy for the next six months rates 65.8 points, a slight increase of 0.4 points from the December survey.
The ZEW numbers are based on a survey of 254 analysts taken between January 6 and January 20. The numbers represent the difference between the percentage of analysts with positive outlooks and those with negative outlooks.
