Data published by the Leibniz Centre for European Economic Research (ZEW) showed that the indicator of German economic sentiment declined significantly in April, recording the second monthly decline in a row.
According to the report, the indicator of economic sentiment fell to 4.1 points compared to 13.0 points in March. Consensus estimates suggested growth to 15.3 points. Thus, the indicator signals that no significant improvement in the economic situation is expected in the next six months. Meanwhile, the index of the current economic situation rose to -32.5 points from -46.5 points in March. Economists had expected an increase to -40 points.
"Financial market experts remain alarmed. The indicator of economic sentiment currently signals the unchanged economic situation over the next six months. Economic expectations are negatively affected by several factors. On the one hand, experts expect banks to be more cautious about lending. On the other hand, still high inflation rates and international restrictive monetary policy have a negative impact. A positive factor is that the danger of an acute crisis in international financial markets is no longer observed,” said ZEW President Professor Achim Wambach.
The data also showed that the indicator of economic sentiment in the eurozone fell to 6.4 points from 10.0 points in March. Economists had expected a rise to 12.2 points. This was the second decline in a row. The indicator of the current economic situation rose to -30.2 from -44.6 in March.