The ZEW Indicator of Economic Sentiment for Germany rose by 6.6 points from the previous month to -17.5 in December 2018, easily beating market expectations of -25. Despite this increase, the indicator is still clearly in negative territory and remains well below the long-term average of 22.5 points due to uncertainties surrounding the looming international trade dispute and Brexit, which have a particularly negative impact on private investment and Germany’s exports. The assessment of the current economic situation decreased sharply in December, with the corresponding indicator falling by 12.9 points to 45.3, way below market forecasts of 55.8. Zew Economic Sentiment Index in Germany averaged 22.53 from 1991 until 2018, reaching an all time high of 89.60 in January of 2000 and a record low of -63.90 in July of 2008.
Zew Economic Sentiment Index in Germany is expected to be -22.00 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Zew Economic Sentiment Index in Germany to stand at 20.00 in 12 months time. In the long-term, the Germany Zew Economic Sentiment Index is projected to trend around 25.00 in 2020, according to our econometric models.