German investor confidence takes a dive | Business| Economy and finance news from a German perspective | DW | 24.05.2016
  1. Inhalt
  2. Navigation
  3. Weitere Inhalte
  4. Metanavigation
  5. Suche
  6. Choose from 30 Languages


German investor confidence takes a dive

A leading German economic think tank has reported an unexpected drop in investor confidence among market players in Europe's powerhouse. Brexit fears are not the only reason for the negative development.

The investor confidence index calculated by Germany's ZEW economic institute decreased by 4.8 points to 6.4 points in May, the think thank said in a statement Tuesday.

"Uncertainties regarding developments such as a possible Brexit currently inhibit a more optimistic outlook," ZEW researchers argued.

President Achim Warmbach added market players in Europe's powerhouse had profited from the strong growth of the German economy in the first quarter (+0.7 percent) which he said was reflected in the sub-index measuring executives' assessments of their current economic situation. It went up by 5.4 percent in May to reach 53.1 percent.

Watch video 01:29
Now live
01:29 mins.

Growth slowdown in Germany?

Not enough skilled workers

In a separate poll, the Association of German Chambers of Industry and Commerce (DIHK) found business leaders in the country expected economic growth to slow down later this year.

For the whole of 2016, it forecast an expansion of 1.5 percent, that's less than the 1.7 percent predicted by the government.

DIHK officials said the export business was hitting a snag. "There were hopes for more exports in the beginning of the year, but as summer draws nearer, those hopes seem to evaporate," the association said, adding that positive effects such as the low oil price and favorable exchange rates had already been priced in.

In addition, companies complained about an increasing lack of skilled workers, posing a risk to their medium and long-term business operations.

hg/jd (Reuters, AFP)

DW recommends

Audios and videos on the topic