Germany’s ZEW Indicator of Economic Sentiment declined to 28.1 in October, down from 34.7 in September—a seven-month high—and below market expectations of 30, underscoring renewed doubts about the strength of the recovery. ZEW President Achim Wambach observed that while the economy is slowly emerging from its period of stagnation, the upturn remains fragile. Persistently high energy prices continue to erode household purchasing power, increase production costs, and keep inflation elevated.
Sector-wise, sentiment in banks and insurance companies saw sharp drops of 18.4 and 9.0 points, respectively, though both indicators remained clearly in positive territory. Confidence also weakened in the services sector, which fell by 6.8 points, and in telecommunications, which declined by 8.2 points, reflecting a more subdued outlook for private consumption. In contrast, the steel and metal production and electrical engineering sectors delivered positive impulses to overall sentiment.
At the same time, the assessment of current economic conditions improved markedly, rising by 11.2 points to -35.9—its highest level since May 2023.
