By Marco Babic
VIENNA (MaceNews) – Expectations for Germany’s economy improved in May, rising to a reading of 51.0 from 28.2 the previous month while the assessment of current conditions fell slightly to -93.5 from -91.5, the ZEW institute said Tuesday.
Markets were expecting the ZEW expectations index at about 33.5, and the current conditions index at about -87.8.
The results for Germany tracked those for the Eurozone where expectations rose to 46.0 from 25.2, while current conditions were more pessimistic in May, falling to -95.0 from -93.9 the previous month.
Despite the improvement in expectations, the economy is expected to still take time to recover to previous levels.
“According to the financial market experts surveyed, economic growth is expected to pick up pace again in the fourth quarter of 2020. However, the catching up process will take a long time. Only in 2022 will economic output return to the level of 2019,” ZEW President Professor Achim Wambach said in a statement accompanying the results.
Earlier Tuesday, the European Automobile Manufacturers Association (ACEA) reported that car registrations fell 76.3% in April and are down 38.5% in the first four months of this year. The German economy, which is heavily dependent on the auto sector, saw registrations fall by 61.1% in April from a year ago and are down 31% year-to-date compared to the same period in 2019.
Even though the car registration results are April and lag Tuesday’s ZEW results, the registration numbers are for the first month in which full restrictions were in place to deal with the Coronavirus. According to ACEA, this was the larges monthly fall since records began.
The next round of data that will give more insight into the economy is the report from the IFO institute scheduled for release on Monday.