By Marco Babic
ZURICH (MaceNews) – Concerns among investors about the impact of COVID-19 on Germany economy pushed the outlook sharply lower in November, according to the latest report from the ZEW institute in Mannheim.
Economic sentiment fell in November to 39.0, down 17.1 points from the October result, and came in below expectations for a sharp decline. The median forecast of an Econoday survey of economists also called for a drop to 40.0.
The result is raising concerns Europe’s largest economy could slip back into a recession, according to ZEW.
“Financial experts are concerned about the economic impact of the second wave of COVID-19 and what this will entail. The ZEW Indicator of Economic Sentiment has therefore once again significantly decreased in November, indicating a slowdown of economic recovery in Germany.
There is also the additional worry that the German economy could head back into recession. According to the assertions made by the experts, neither the Brexit negotiations nor the outcome of the US presidential election currently are having an impact on the economic expectations for Germany,” comments ZEW President Professor Achim Wambach on the current expectations.
The assessment of current conditions worsened as well, although not to the same degree as the economic outlook, falling 4.8 points to -64.3. The Econoday median called for a decline to -65.0.
Sentiment in the Euro-area fell similarly in November, down 19.5 points to 32.8, while current conditions improved a modest 0.2 points to -76.
Germany’s Ifo Institute will release its version of economic sentiment on November 24 at 10:00 am CET and investors will be looking to see if that result confirms today’s ZEW report.
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