ZEW Indicator of Economic Sentiment - Slight Recovery

The ZEW Indicator of Economic Sentiment for Germany increased in November 2008 by 9.5 points. The indicator now stands at minus 53.5 points after minus 63.0 points in the previous month. This is still well below its historical average of 27.1 points.

The increase of the economic sentiment indicator partly corrects the considerable decline of expectations following the turbulences on the financial markets in the previous month. The rescue package of the German government for the financial sector and the planned economic stimulus package seem to have slightly raised the confidence of the financial market experts compared to the previous month. Moreover, the worldwide interest rate cuts might also slow down the economic downturn.

"The earlier pessimistic expectations of the financial market experts are confirmed by the current economic development in Germany. The experts, however, seem hopeful that the collective actions of governments and central banks will mitigate the economic slowdown", says ZEW President Prof. Dr. Dr. h.c. mult. Wolfgang Franz.

The assessment of the current economic situation in Germany worsened in November 2008. The corresponding indicator dropped by 14.5 points to minus 50.4 points. The economic expectations for the euro zone increased in November. The indicator rose by 8.7 points and now stands at minus 54.0 points. The indicator for the current economic situation in the euro zone dropped by 14.2 points and now stands at minus 58.9 points.

For further information please contact

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

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