The economic outlook in November in Germany is looking rather grim as far as financial market experts are concerned.
According to the latest economic sentiment survey from ZEW, the Leibniz-based Centre for European Economic Research, investor sentiment looking at the months ahead has taken another dive this month, falling more than 17 points to 39 — a significant decline since the optimistic, temporary high of 77.4 points in September.
With Germany in a partial lockdown for the month of November, and neighbouring countries imposing tougher new restrictions on public and business life, investors’ gloomier assessment of the current economic situation is not surprising.
“Financial experts are concerned about the economic impact of the second wave of COVID-19 and what this will entail. The ZEW Indicator of Economic Sentiment has therefore once again significantly decreased in November, indicating a slowdown of economic recovery in Germany,” said ZEW president Achim Wambach.
Wambach said that there is also a worry that the German economy could fall back into recession.
“According to the assertions made by the experts, neither the Brexit negotiations nor the outcome of the US presidential election currently are having an impact on the economic expectations for Germany,” Wambach said.
Europe’s largest economy reported 8.2% GDP growth in the third quarter compared with the same quarter in 2019, beating predictions for a 7.3% growth. The government also revised its GDP forecast for 2020 to a decline of 5.5%, from 5.8% predicted earlier.
Looking across the Eurozone, investors also reported draining optimism, with the ZEW indicator falling for the second month in a row in November, to 32.8, which is 19.5 points lower than in October.
The ZEW index reflects the latest Ifo Business Climate Index reading, which showed that, after a hopeful summer, the mood among Germany’s company bosses had clouded over in October.
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