ZEW Indicator of Economic Sentiment Germany

Data Sentiment

Source: ZEW
Source Link: https://www.zew.de/
Frequency: Monthly
Next Release(s): September 16th, 2025 5:00 AM

Latest Updates

The ZEW Indicator of Economic Sentiment for Germany fell -18.0 pts to 34.7 in August 2025, ending several months of gains, as experts reacted negatively to the announced EU–US trade deal and weak Q2 performance.
- The Current Situation Index for Germany dropped -9.1 pts to -68.6, while the eurozone index fell -7.0 pts to -31.2.
- Eurozone sentiment declined -11.0 pts to 25.1, reflecting downgraded growth expectations despite earlier positive Q2 estimates.
- Outlook worsened most for chemicals, pharmaceuticals, mechanical engineering, metals, and automotive industries.
- The expectations index for the US eased -7.0 pts to -41.2, while for China slipped just -0.3 pts to 3.9.
- Inflation expectations stayed negative in the eurozone (-6.7) and Germany (-5.1), while a net 74.5% of respondents expect the US to see higher inflation.
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The ZEW Indicator of Economic Sentiment for Germany rose 5.2 pts to 52.7 in July 2025, continuing its upward trend and reflecting firming optimism despite global trade uncertainties.
- The Current Situation Index for Germany rose 12.5 pts to -59.5, still negative but improving.
- Sentiment in the eurozone rose 0.8 pts to 36.1, while the eurozone Current Situation Index increased 6.5 pts to -24.2.
- ZEW attributes rising optimism to easing US-EU trade tensions and Germany’s planned investment stimulus.
- Sector-specific sentiment improved notably in mechanical engineering, metal production, and the electrical industry.
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The ZEW Indicator of Economic Sentiment for Germany rose 22.3 pts to 47.5 (vs 35 expected) in June 2025, marking continued improvement and the highest level since early 2022.
- The Current Situation index for Germany increased 10.0 pts to -72.0, still the lowest among countries analyzed.
- Eurozone sentiment rose 23.7 pts to 35.3, entering positive territory.
- The eurozone Current Situation index rose 11.7 pts to -30.7.
- ZEW attributes rising sentiment to stronger investment and consumer demand, recent ECB rate cuts, and optimism around new German fiscal policies.
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The ZEW Indicator of Economic Sentiment for Germany bounced 39.2 pts to 25.2 in May, a much stronger than expected bounce over the 11.9 forecast.
- The Economic Situation Germany index, however, declined -0.8 pts to -82.0. This reading is the lowest among all countries analyzed by ZEW.
- The ZEW Indicator of Economic Sentiment for the euro area and the US both recovered as well, rising 30.1 pts to 11.6 and rising 23.3 pts to -48.2, respectively.
- Inflation and interest rate expectations broadly declined while optimism around equity prices improved.
- ZEW: ““Expectations are brightening. The ZEW indicator sees a major improvement in May 2025 and compensates for part of the losses observed in the April survey. With a new government in place, some progress in the tariff disputes and a stabilising inflation rate, optimism has increased.”
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The ZEW Indicator of Economic Sentiment for Germany dropped -65.6 pts to -14.0 in April, the largest decline in expectations since Russia invaded Ukraine in 2022 and well below expectations of a 9.5 pt reading.
- The Economic Situation Germany index improved 6.4 pts to -81.2, the highest since August 2024.
- The ZEW Indicator of Economic Sentiment for the euro area also saw a major decline, falling -58.3 pts to -18.5, and the US index fell further, down -22.8 pts to -71.5.
- ZEW: “The erratic changes in the US trade policy are weighing heavily on expectations in Germany, which have sharply declined. It is not only the consequences the announced reciprocal tariffs may have on global trade, but also the dynamics of their changes, that have massively increased global uncertainty. The economic expectations for Germany and the Eurozone reflect this development.”
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The ZEW Indicator of Economic Sentiment Germany jumped 25.6 pts to 51.6 in March, above the 48.1 expected reading and the highest since February 2022.
- The Economic Situation Germany index remained lower, however, increasing just 0.9 pts to 87.6.
- The index tracking financial market experts was up 15.6 pts to 39.8.
- ZEW: “The brighter mood is likely due to positive signals regarding the future German fiscal policy, for example the agreement on the multi-billion-euro financial package for the federal budget.”
- The ZEW expectations index for the euro area also increased, up 15.6 pts to 39.8, but the current conditions index was basically unchanged at -45.2.
- The ZEW expectations index for the US crashed 50.0 pts to -48.7, and the current conditions index fell -35.9 pts to 6.7.
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The ZEW Indicator of Economic Sentiment for Germany jumped 15.7 pts to 26.0, a surprise over the 20.0 reading that was expected. This was the strongest MoM increase in two years.
- The Economic Situation Germany index was more pessimistic but saw a slight increase of 1.9 pts to -88.5.
- ZEW suggests that the new German federal election has caused expectations to improve as well as the ECB rate cuts which should be supportive of demand.
- ZEW’s current situation and expectations indexes for the euro area also improved by 8.5 pts to -45.3 and 6.2 pts to 24.2, respectively.
- Despite the improvement in sentiment, expectations for stocks have fallen across many markets: STOXX 50 down -11.8 pts to -0.8, DAX 40 down -5.3 pts to -4.7, and the DJIA down -18.0 pts to 12.1.
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The ZEW Indicator of Economic Sentiment Germany fell -5.4 pts to 10.3 in January, below expectations of 15.3. The Economic Situation Germany index increased just 2.7 pts, remaining at a deeply negative -90.4. ZEW analysis: “A lack of private household spending and subdued demand in the construction sector continue to stall the German economy. If these trends continue in the current year, Germany will fall further behind the other countries of the Eurozone.”

ZEW economic expectations for the euro area were stronger at 18.0 with the current situation index less negative at -53.8. The assessment of the inflation situation remained negative but there was a large increase in both the euro area and Germany in January, +9.1 pt to -14.8 and +9.7 pts to -16.0 respectively.

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The ZEW Indicator of Economic Sentiment for Germany increased 8.3 pts to 15.7 in December, the highest since August and above expectations of a 6.5 reading. On the other hand, the Economic Situation Germany index fell -1.7 to -93.1, the lowest since the pandemic reading in May 2020. The outlook is improving from rate cut expectations and hopes that a change in economic policy following snap elections could improve business conditions. However, that does little to change the current fraught conditions.

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