- Wolfgang Franz, ZEW President
The ZEW Indicator of Economic Sentiment fell 2.7 points to minus 19.6 in July, indicating the third decrease in a row. This is due to the Eurozone sovereign debt crisis and slowing global demand that contributed to a gloomy investors' outlook.
German economy with 0.5% growth in Q1 is running out of steam due to austerity measures imposed in Eurozone member states. Moreover, slowing world's growth limits demand for German products.
"The decline of the economic expectations concerning the end of 2012 is flattening out gently. This could possibly be an early sign of an encouraging development in 2013. However, risks should not be underestimated. Besides the weak demand from the Eurozone for German exports, the German economy is also burdened by weakening growth dynamics in other important partner countries," said ZEW President Wolfgang Franz.
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