The economic expectations of German financial experts have surprisingly brightened from a low level.
The mood barometer of the Mannheim research institute ZEW rose by 6.7 points to minus 34.3 points in May compared to the previous month, as the Center for European Economic Research announced on Tuesday.
Experts had predicted an average drop to minus 43.5 points.
The assessment of the economic situation, on the other hand, deteriorated by 5.7 points to minus 36.5 points.
It is the third consecutive decline since the beginning of the war in Ukraine.
"The experts are assuming that the situation will continue to deteriorate, but with less intensity," commented ZEW President Achim Wambach with regard to the economic development.
The corona restrictions in China led to a significant deterioration in the assessment of the economic situation there.
"This is a heavy burden for future economic growth in Germany."
In March of this year, the ZEW expectations collapsed by 93.6 points due to the Ukraine war, more than at any time since the survey began in December 1991.
stagflation
According to the financial experts, the current economic situation is bad and will continue to deteriorate, summarized Wambach.
As before, the experts are also assuming stagflation in the coming months – i.e. a phase with practically no growth and high inflation at the same time.
According to the ZEW, a large majority of those surveyed assume that the European Central Bank will raise short-term interest rates in the next six months.
Accordingly, they expected inflation to fall.
For the index, which is considered an important indicator of economic development, the ZEW asks experts from banks, insurance companies and the finance departments of large companies for their assessments of important international financial market data such as inflation rates, interest rates, stock indices, exchange rates and the oil price.
For the current data, 184 analysts and institutional investors were surveyed from May 2nd to 9th.