Germany’s economic sentiment surges in March ’25

Germany’s economic sentiment improved sharply in March, with the ZEW Indicator of Economic Sentiment rising 25.6 points to 51.6, its highest increase since January 2023.

The assessment of the current economic situation remained stable, edging up 0.9 points to minus 87.6.

ZEW President Achim Wambach cited positive fiscal policy signals, including a multi-billion-euro budget agreement, and improved prospects for the metal, steel, and mechanical engineering sectors.

“Economic expectations are improving considerably again in March, with a strongly increasing ZEW Indicator of Economic Sentiment. The brighter mood is likely due to positive signals regarding the future German fiscal policy, for example the agreement on the multi-billion-euro financial package for the federal budget.” said Wambach.

“In particular, prospects for metal and steel manufacturers as well as the mechanical engineering sector have improved. Last but not least, the sixth consecutive interest rate cut by the ECB means favourable financing conditions for private households and companies,”

The European Central Bank’s sixth consecutive rate cut also supported sentiment.

In the Eurozone, economic expectations climbed 15.6 points to 39.8, while the current situation assessment held steady at minus 45.2 points.

Attribution: Amwal Al Ghad English

Subediting: Y.Yasser