German ZEW Economic Sentiment Index drops sharply to 19.2 in August vs. 38.0 expected
|- Germany’s ZEW Economic Sentiment Index slides to 19.2 in August.
- EUR/USD eases toward 1.0900 after German and Eurozone ZEW surveys.
The headline German ZEW Economic Sentiment Index dropped sharply from 41.8 in July to 19.2 in August, missing the market consensus of 38.0.
The Current Situation Index, however, worsened from -68.9 in July to -77.3 in the eighth month of the year.
The Eurozone ZEW Economic Sentiment Index came in at 17.9 in August, sharply lower than the July reading of 43.7. The data fell short of the market expectation of 35.4.
Key points
Economic outlook for Germany is breaking down.
In the current survey, we observe the strongest decline of the economic expectations over the past two years.
Economic expectations for the eurozone, the US and China also deteriorate markedly.
As a result, especially the expectations for export-intensive german sectors decline.
It is likely that economic expectations are still affected by high uncertainty.
Most recently, this uncertainty expressed itself in a turmoil on international stock markets.
Market reaction
The EUR/USD pair is feeling the pull of gravity on discouraging German and Eurozone ZEW surveys. The pair is losing 0.14% on the day to trade near 1.0915, at the press time.
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