-Clemens Fuest, ZEW President
Some positive data came out on Tuesday, supporting ECB President Mario Draghi comments earlier in the week that the Euro zone's sustained recovery is underway. Sentiment among German investors rose for the fifth straight month to the highest level in 13 months in March, led by sturdy domestic economic data. The index of investor and analyst expectations, which is designed to predict economic developments in coming six months, increased to 54.8 from 53 in February, according to the ZEW Centre of European Economic Research. Nevertheless, the figure fell short of the 59.4 expected by analysts. Investors remained concerned about the outcome of Greece's talks with the European Union creditors, where Germany plays the key role. A gauge of the current situation rose to 55.1 in March from 45.5 in the preceding month, ZEW said. Other recent data has painted a positive picture of the Euro zone's number one economy, with the private sector gaining momentum, jobless rate declining, retail sales soaring and output increasing, though orders have dropped. Moreover, low oil prices, a weak Euro and the ECB's QE programme also indicate that Germany's economy will grow robustly this year after expanding by 1.6% last year.
A separate report confirmed Euro zone consumer prices declined 0.3% on annual basis in February, following the 0.6% drop a month earlier. However, core inflation climbed 0.5% on month for an annual increase of 0.7%, accelerating from 0.6% reported in January.
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