Confidence in the German financial center continues to grow.

This is the result of the survey published on Thursday by the research institute at Frankfurt's Goethe University, the Center for Financial Studies (CFS).

The mood barometer, the CFS index, increased again in the second quarter and is well above the previous year's level, when an initial recovery from the pandemic became apparent.

According to the CFS, the positive development is based in particular on positive reports from financial institutions regarding their workforce.

The downsizing was stopped in the second quarter and employees were hired again.

Markus Frühauf

Editor in business.

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The financial sector expects this positive development to continue in the current quarter.

In addition, the financial institutions reported slight growth in sales to the CFS, albeit with lower earnings growth.

"The financial sector is thus following the recently significantly brightened business climate in the German real economy in its assessments of its own business situation," said CFS Director Andreas Hackethal in the press release.

Skepticism about international importance

The future international importance of Germany as a financial center is viewed somewhat more skeptically. After being assessed very positively with rising values ​​for several quarters in a row, the index value decreased slightly in the second quarter. "We are confident that Germany's international importance as a financial center will continue to develop positively," said Gerhard Wiesheu, President of Frankfurt Main Finance. Cooperation between all major European financial centers is also very important in this context - it is essential for the creation of a uniform capital market and a European banking union.

The German financial sector is following the strategic realignment of the European Central Bank (ECB) critically. In particular, the stronger focus on climate and environmental protection is viewed with skepticism. Almost two thirds of the decision-makers surveyed reject the green component in monetary policy, for example through the purchase of green bonds. “It is not yet clear how the ECB will take climate protection aspects into account in its decisions in the future. But many market participants are obviously skeptical, ”said Volker Brühl from CFS. According to him, the previous communication by the ECB on climate protection issues and monetary policy leaves many questions unanswered and should be clarified as soon as possible.

In the survey, 60 percent were of the opinion that the ECB should have stuck to the previous target for the inflation rate of just under 2 percent. Around 37 percent of those surveyed, on the other hand, are of the opinion that the ECB should temporarily accept a slightly higher inflation rate.