German investor morale rebounds ahead of election

Germany’s investor morale has experienced a sharp rebound, according to the ZEW Indicator of Economic Sentiment for February 2025, which rose by 15.7 points to reach 26.0.

This marked the strongest increase in two years, with analysts attributing the surge to growing optimism surrounding the upcoming federal election and expectations for a more effective government.

Private consumption is also forecasted to gain momentum in the next six months.

While assessments of the current economic situation showed only a slight improvement (+1.9 points to -88.5), the positive outlook is further buoyed by the European Central Bank’s recent interest rate cut, which is expected to support the construction industry.

Sentiment across the eurozone mirrored Germany’s recovery, with the eurozone economic sentiment indicator rising by 6.2 points to 24.2.

The current economic situation in the region also improved, with the indicator rising 8.5 points to -45.3.

Attribution: Amwal Al Ghad English

Subediting: Y.Yasser