Germany’s ZEW Indicator of Economic Sentiment rose to 34.7 in September 2026, its highest level since February, although it remained below market expectations of 37. The result signals cautious optimism about the recovery of Europe’s largest economy, which is still seen as underpinned by fiscal stimulus and measures aimed at strengthening exports. Nonetheless, substantial risks persist. Elevated energy costs associated with the ongoing war with Iran, as well as uncertainty stemming from hybrid attacks, continue to cloud the outlook.
At the sector level, the insurance industry benefited from higher interest rates, with its sentiment balance increasing by 12.1 points to 46.4. The banking sector also recorded a marked improvement, as its balance rose by 8.2 points from August to 52.9. In contrast, the steel and metal production sector and the automotive industry remained in negative territory.
The assessment of current economic conditions also improved significantly, jumping 14 points to -47.1, its highest level since June 2023.
