Mixed messages for Germany this morning?
According to the country’s ZEW survey, despite an improving climate, economic sentiment among German investors isn’t as cheerful as most thought, with the main indicator decreasing by six points to 55.7 in February.
Although still at a high level, the slightly gloomy result stems from uncertainties created by disappointing employment figures and other weaker-than-expected lead indicators that have pointed to slowing momentum in the US.
When it came to feelings on the current state of the economy, though, the indicator rose sharply from 41.2 to 50.0 - the highest level since August 2011. Moreover, it became less negative again for the Eurozone.
The blow to optimism can be put down to emerging market turbulence, says Berenberg’s Christian Schulz - the dent is temporary, he stresses, and doesn’t point to a change in trajectory.
Capital Economics says current sentiment is consistent with annual GDP growth of over two per cent and that, paired with PMI indications, Germany’s set to continue outperforming the rest of the euro area.
It expects GDP to expand by around 1.5 per cent over 2014 as whole.