Germany’s ZEW Economic Sentiment index edged down from 59.6 to 58.3 in February, missing expectations of 65.2 but still pointing to cautious optimism. Current Situation index improved from -72.7 to -65.9, roughly in line with forecasts. At the Eurozone level, ZEW Economic Sentiment index fell from 40.8 to 39.4, undershooting expectations of 45.2. However, the Current Situation measure improved by 4.5 points to -13.6.
ZEW President Achim Wambach described the recovery as “fragile,” noting that structural challenges continue to weigh on industry and private investment. He emphasized that upcoming reforms to Germany’s social insurance system should be used to strengthen the country’s competitiveness as a business location.
Sector breakdown showed moderate to strong improvement in export-oriented industries, including chemicals and pharmaceuticals, steel and metals, and mechanical engineering, likely reflecting stronger incoming orders late last year. Private consumption prospects also improved, while banks, insurers, and IT sectors reported weaker expectations.
