Financial News: German ZEW Investor Confidence Rebounds In May

German ZEW Investor Confidence Rebounds In May

05/13/2025 - 06:08:00 (RTTNews)

(RTTNews) - German investor confidence rebounded in May as the formation of new government as well as the progress in the tariff disputes strengthened expectations, a survey published by the think tank ZEW showed on Tuesday.

The ZEW Indicator of Economic Sentiment climbed sharply by 39.2 points to 25.2 in May. The reading was well above economists' forecast of 9.8.

However, the assessment about the current economic situation remained deep in the negative territory. The current situation index dropped unexpectedly by 0.8 points to -82.0. The score was forecast to improve to -77.0.

"With a new government in place, some progress in the tariff disputes and a stabilizing inflation rate, optimism has increased," ZEW President Achim Wambach said.

The outlook has improved in particular for the banking industry and export-intensive sectors such as the automobile and chemical industries, as well as metal, machine and steel production, Wambach noted.

The recent interest rate reduction by the European Central Bank and anticipated future rate cuts positively affected the construction industry, Wambach said. Moreover, respondents expect domestic demand to pick up on a six-month horizon and boost the German economy.

Economic confidence in the euro area improved strongly in May. The economic sentiment index climbed 30.1 points to 11.6. The assessment of the current economic situation also improved, albeit less markedly. At -42.4, the index rose by 8.5 points from April.

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