German ZEW Economic Sentiment rose to 10.7 in December, up from -2.1, beat expectation of 1.1. It’s also the highest value since February 2018. Current Situation Index also rose to -19.9, up from -24.7, beat expectation of -22.0. Eurozone ZEW Economic Sentiment rose to 11.2, up from -1, beat expectation of 2.2. Current Situation Index rose 4.9 pts -14.7.

ZEW President Achim Wambach: “At first glance, the renewed substantial increase of the ZEW Indicator of Economic Sentiment may seem surprising. It rests on the hope that German exports and private consumption will develop better than previously thought. This hope results from a higher than expected German foreign trade surplus in October, alongside relatively robust economic growth in the EU in the third quarter and a stable German labour market. The rather unfavourable figures for industrial production and incoming orders for October, however, show that the economy is still quite fragile.”

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Eurozone Sentix Investor Confidence rose to 0.7 in December, up from -4.5 an beat expectation of -5.4. That’s the highest level since May this year. Current Situation Index rose from -5.5 to -5.0, highest since July. Expectations Index rose from -3.5 to 2.5, highest since March 2018.

Sentix said, “the second improvement in a row may be taken as an indication that the spectre of recession has been dispelled in the Euro zone”. And, more and more investors are convinced that “the worst is over” for the economy. Investors are pinning their hops on an “increase in government spending on government investment.

For Germany, the overall Investor Confidence Index rose from -6.5 to -1.4, highest since June. Current Situation Index rose from -8.3 to -3.3, highest since July. Expectations Index rose from -4.8 to 0.5, highest since February 2018. Sentix said, “As a former world export champion, the country has recently been particularly affected by problems in world trade. Now that a trend reversal has been confirmed – starting with the region Asia ex Japan – this automatically means an easing for the German economy.”

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German expects rose 1.9% yoy to EUR 119.5B in October while imports dropped -0.6% yoy to EUR 98.0. Trade surplus came in at EUR 21.56B. On calendar and seasonally adjusted terms, exports rose 1.2% mom while imports was flat. Trade surplus widened to EUR 20.6B, beat expectation of EUR 19.0B.

According to provisional results of the Deutsche Bundesbank, the current account of the balance of payments showed a surplus of EUR 22.7B. That takes into account the balances of trade in goods including supplementary trade items (EUR 22.5B), services (EUR -4.3B), primary income (EUR 9.0B) and secondary income (EUR -4.5B).

Full release here.