- Clemens Fuest, ZEW president professor
Investor morale in Europe's largest economy took another hit in August, despite the progress made in debt talks between Greece and its international creditors. The German ZEW Economic Sentiment Index fell to 25.0 points in August, from a recorded reading of 29.7 points the month before. Market participants, however, had expected a result of 31.9. Nonetheless, a result of above 0.0 indicates an optimism for Germany's economic outlook during the next six months. Moreover, August was the fifth consecutive month, which saw surveyed investor and analyst confidence declining. This slip in optimism can be attributed to geopolitical developments around the world and the minor slowdown in the German manufacturing sector in July. The German investor sentiment peaked at 54.8 in March of this year, however, since then the morale has steadily declined. Meanwhile, the current situation in Europe's growth engine improved marginally to 65.7 points from a reading of 63.9 in the seventh-month of the year.
Furthermore, the ZEW Economic Sentiment for the overall outlook of the Euro zone improved in the eighth-month of the year. The investor confidence grew to 47.6 points for the reported month, compared to 42.7 points in July, and beating the 43.9 points expected by economists.
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