German Investor Morale Gains, Broad-Based Recovery Expected

The ZEW said its survey of investors’ economic sentiment rose to 76.6 points from 71.2 the previous month. A Reuters poll had forecast a rise to 74.0.

ZEW polled 189 analysts in the period March 8–15 for its survey. On March 15, Monday, Germany said it had suspended use of AstraZeneca’s COVID-19 vaccine.

“Economic optimism continues to rise. Experts expect a broad-based recovery of the German economy,” ZEW President Achim Wambach said in a statement.

“They anticipate that at least 70% of the German population will be offered a vaccine against Covid-19 by autumn. However, a large majority also expects inflation to continue to grow, as well as higher long-term interest rates.”

A separate gauge of current conditions rose to -61.0 points from -67.2 the previous month. That compared with a consensus forecast of -62.0 points.

Thomas Gitzel, economist at VP Bank Group, noted that the survey did not reflect the AstraZeneca vaccine suspension.

“The already sluggish European vaccination campaign now gets another damper,” he said. “Europe is facing a third wave of infections rather defencelessly.

“There is a growing risk that the agreed relaxation (in restrictions) will soon have to be withdrawn again. This would further delay the economic recovery.”

Earlier this month, Chancellor Angela Merkel and German state leaders agreed a phased easing of coronavirus curbs along with an “emergency brake” to let authorities re-impose restrictions if case numbers spike again.

Recent German data has painted a picture of a two-speed economy in which export-oriented manufacturers are doing well while domestically driven services are suffering under lockdown measures imposed in early November and tightened in mid-December to contain a second wave of coronavirus infections.