German investor confidence drops over VW scandal and EM woes
The monthly ZEW index, measuring the six month economic outlook for Germany, dropped to a one year low.
The survey, conducted between late September and mid October among 2017 institutional investors and analysts in Germany, revealed a sharp deterioration of the current situation in Germany, declining by -12.3 to 55.2 bsp, as well as a negative outlook for the next half year, with forecasts being reduced by 10.2 bsp to 1.9 bsp.
“The emmissions scandal at Volkswagen and weak growth in emerging markets undermined the economic outlook for Germany. However, due to nevertheless strong domestic economy and a gradual recovery of the Eurozone, it appears unlikely that Germany would slide back into recession” comments ZEW president Clemens Fuest.
The lack of German investor confidence was reinforced by weak export figures throughout August, with seasonally adjusted exports falling by -5.2% and manufacturing turnover declining by 1.3%, according to Federal Statistical Office Destatis.