ZEW Indicator of Economic Sentiment - Experts More Moderate

The ZEW Indicator of Economic Sentiment for Germany dropped by 3.7 points in June 2007 and now stands at 20.3 points after having boasted 24 points in May. This is still below its historical average of 33.0 points.

After a smaller number of incoming orders in April and owing to an extraordinarily good assessment of the current economic situation in Germany the number of experts who expect a further improvement of the German economy has decreased. The majority of experts still believe that Germany's economic development will remain unchanged.

"The assessment of the current economic situation is still excellent, but the economic development of Germany is not expected to further gain momentum. Nevertheless, the assessment of the business situation and the expectations still signal good economic perspectives for Germany," said ZEW President Prof. Dr. Dr. h.c. mult. Wolfgang Franz.

The assessment of the current economic situation remained almost unchanged. The corresponding indicator increased by 0.7 points to 88.7 points in June.

Economic expectations for the euro zone have decreased as well. The indicator dropped by 3.3 points and now stands at 19 points. The corresponding indicator for the current economic situation in the euro zone increased this month by 4.2 to 86 points.

293 analysts and institutional investors participated in this month's ZEW Financial Markets Survey which is conducted on a monthly basis by the Centre for European Economic Research (ZEW), Mannheim. The participants were asked from June 4 to June 18, 2007 about their medium-term expectations concerning economic activity and capital markets. The ZEW Indicator of Economic Sentiment shows the balance between positive and negative expectations regarding future economic activity in Germany within a timeframe of six months. The horizontal line indicates the historical mean of the indicator.

Contact

Dr. Sandra Schmidt, E-mail: s.schmidt@zew.de 

Matthias Köhler, E-mail: koehler@zew.de