German ZEW index hits highest level in three years

(Sharecast News) - Investor morale in Germany surged in March to its highest level in more than two years, according to the Centre for European Economic Research (otherwise known as ZEW), on the back of improved confidence in the government's new fiscal policies. The ZEW Indicator of Economic Sentiment jumped 25.6 points to 51.6 this month, the biggest one-month increase in 14 months.

This was the highest level for the index since February 2022 and comfortably above the consensus forecast of 48.1.

Meanwhile, the current economic situation index for Germany remained relatively stable, rising just 0.9 points to -87.6.

"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," said ZEW president Achim Wambach.

Wambach said that prospects for metal and steel manufacturers improved, along with those for the mechanical engineering sector, while the sixth consecutive interest rate cut by the European Central Bank have helped sentiment.