German investor sentiment deteriorates amid Covid-19 worries
German investor sentiment deteriorated in March amid concerns about the Covid-19 pandemic, according to the latest survey from the ZEW Center for European Economic Research in Mannheim.
The headline ZEW investor expectations index slumped to -49.5 from 8.7 in February, coming in well below expectations for a reading of -26.4 and marking the biggest drop since the survey began in December 1991.
The current situation index fell to -43.1 from -15.7, versus expectations of -30.0.
ZEW President Professor Achim Wambach said the sharp decline in the ZEW indicator was to be expected.
"The economy is on red alert. The financial market experts currently expect to see a decline in real gross domestic product in the first quarter, while also considering a further drop in the second quarter to be very likely. For the whole of 2020, the majority of experts currently expect a decline in real GDP growth of approximately one percentage point as a result of the corona pandemic."
Pantheon Macroeconomics said: "The slide is consistent with the dramatic shift in sentiment and prices in relation to the Covid-19 outbreak, and we doubt it will improve much anytime soon.
"The only reason to keep an eye on these data at this point is the extent to which they provide a lead on the March economic surveys, which are set to be unrelentingly terrible."