ZURICH (MaceNews) – Economic sentiment in Germany came in well above expectations in January indicating that the economy is seen improving in the coming six months, as COVID cases are seen falling by summer, the latest report from the Mannheim-based ZEW institute showed.
ZEW’s Index of Economic Sentiment rose to 51.7 in January from 29.9 in December, soundly beating economist’s expectations for a modest increase to 32.0, according to the median of an Econoday survey of forecasts.
At the same time, the assessment of current conditions was more negative in January than in December, with the index falling to -10.2 from -7.4 in January. Economists in the Econoday survey were expecting a slight improvement to -7.3, according to the median forecast.
“The economic outlook has improved considerably with the start of the new year. The majority of financial market experts assume that economic growth will pick up in the coming six months. It is likely that the phase of economic weakness from the fourth quarter of 2021 will soon be overcome. The main reason for this is the assumption that the incidence of COVID-19 cases will fall significantly by early summer. The more positive economic expectations include the consumer related and export-oriented sectors and thus a large part of the German economy,” comments ZEW President Professor Achim Wambach on current expectations.
In the Eurozone, economic sentiment also improved, increasing 22.6 points to 49.4, while the current situation worsened by 3.9 points to -6.2, according to ZEW.
The Ifo Institute will release its closely watched business sentiment index on Tuesday, January 25 at 10:00 CET.