- Peter Praet, the European Central Bank's Chief Economist
Business morale in Germany improved in November following seven successive monthly falls. The investor confidence index surged to 10.4 points, up from 1.9 points a month earlier, according to the ZEW economic institute. The current situation index, however, slid to 54.4 in November, down from October's 55.2. The high level of domestic consumption, the recent weakening of the Euro and the outgoing recovery in the US are likely to boost the robust development in the German economy. The current economic situation in German looks disappointing, as inflation remained below the targeted level and as the German economy was hit hard by a slowdown in emerging markets, the Volkswagen scandal, the migration crisis. The Euro zone's powerhouse grew 0.3% in the third quarter, following the 0.4% expansion in the preceding three-month period. Domestic consumption remained the main driver of the economy. At the same time Germany's inflation climbed 0.3% year-on-year in November, after a flat reading in the previous month.
Meanwhile, Peter Praet, ECB Execute Board member said that downside risks to the Euro zone's growth increased in the aftermath of the weekend's events. Moreover, Praet added that the return of inflation to 2% is at risk of being pushed backwards again.
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