Expectations Remain at a Low Level

The ZEW Indicator of Economic Sentiment for Germany recorded a decline in the current April 2022 survey, falling 1.7 points to a new reading of minus 41.0 points. The assessment of the economic situation in Germany has again worsened significantly in the current survey. The corresponding indicator dropped 9.4 points to a level of minus 30.8 points. This is the second time the indicator has recorded a decrease since the start of the war in Ukraine. The expectations and assessments of the economic situation are currently similar to those at the beginning of the COVID-19 pandemic in March 2020. Inflation expectations for Germany have fallen by 43.4 points in the current survey to a new value of 26.8 points.

“The ZEW Indicator of Economic Sentiment remains at a low level. The experts are pessimistic about the current economic situation and assume that it will continue to deteriorate. The decline in inflation expectations, which cuts the previous month’s considerable increase by about half, gives some cause for hope. However, the prospect of stagflation over the next six months remains,” comments ZEW President Professor Achim Wambach on current expectations.

The financial market experts’ sentiment concerning the economic development of the eurozone decreased 4.3 points in April and currently stands at minus 43.0 points. The situation indicator fell to a new level of minus 28.5 points, dropping 6.6 points compared to the previous month.

Inflation expectations for the eurozone declined by 43.6 points in the current survey. The indicator currently stands at 25.9 points. 47.5 per cent of the experts expect the inflation rate to increase in the next six months.

More information and studies on the ZEW Indicator of Economic Sentiment and the release dates 2022 (as PDF file, 28 KB) and the historical time series (as Excel file, 81 KB)

More about Achim Wambach on Twitter: @AchimWambach