German investor confidence pulls back from four-year high

(Sharecast News) - Investor morale in Germany unexpectedly eased in February, pulling back from a four-year high, according to the Centre for European Economic Research (ZEW) on Tuesday. The ZEW Economic Sentiment Index, which tracks confidence levels among analysts and institutional investors, fell to 58.3 this month, coming in well below the consensus forecast of 65.

According to ZEW, expectations about Germany's economic situation "stabilised" this month after the index hit the highest level since July 2021 in January at 59.6.

"The ZEW Indicator remains stable. The German economy has entered a phase of recovery, albeit a fragile one," said ZEW president Achim Wambach.

"There are still considerable structural challenges, especially for industry and private investment. The impending reforms of the system of social insurances should be used to significantly enhance Germany's attractiveness as a business location," he said.

ZEW said that export-oriented sectors showed moderate to strong improvements in February, particularly the chemical and pharmaceutical industries, steel and metal production, and mechanical engineering, helped by better-than-expected incoming orders at the end of 2025. However, banks, insurers and the IT sectors saw conditions worsen.