Hopes of a Recovery Are Fading

The ZEW Indicator of Economic Sentiment for Germany recorded yet another considerable decline in the September 2024 survey. At 3.6 points, it is 15.6 points below the August value. The optimism in economic expectations that has been evident since November 2023 has thus almost completely dwindled. The assessment of the economic situation in Germany has also continued to worsen. The corresponding indicator fell 7.2 points to a new value of minus 84.5 points. The assessment of the current economic situation is thus at its lowest since May 2020.

“The hope for a swift improvement in the economic situation is visibly fading. In the latest survey, we once again observe a noticeable decline in economic expectations for Germany. The number of optimists and pessimists is now evenly balanced. Although the falling economic expectations for the eurozone point to an overall rise in pessimism, the drop in expectations for Germany is significantly greater. Most respondents appear to have already factored the ECB’s interest rate decision into their expectations,” comments ZEW President Professor Achim Wambach on the survey results.

The financial market experts’ sentiment concerning the economic development of the eurozone experienced a decrease in September. At 9.3 points, the indicator lost 8.6 points compared to August. The situation indicator for the eurozone also worsened, falling 8.0 points to a new reading of minus 40.4 points.