Investor Confidence in Germany Stabilizes | Business| Economy and finance news from a German perspective | DW | 07.12.2004
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Investor Confidence in Germany Stabilizes

December saw investor confidence in Germany, the euro zone's biggest economy, stabilize despite negative economic effects of the strong euro, a new poll showed Tuesday. The ZEW economic research institute's economic expectations index, based on a poll of 300 analysts and institutional investors, rose by 0.5 points to plus 14.4 points after falling sharply in the preceding four months, ZEW said in a statement. The slight increase was unexpected: Analysts had been pencilling in a further decline of some 2.9 points in the December index. "Positive and negative economic data are more or less balancing each other out," ZEW President Wolfgang Franz said. "On the one hand, the decline in the value of the dollar is continuing to be source of concern, since it could jeopardize the competitiveness of German exports. On the other hand, the sharp drop in the price of oil is making the analysts who took part in the poll more confident." While strong swings in exchange rates and oil prices still represent risks to the recovery scenario, "there is no reason to alter our projection for a slight recovery next year," Franz said.

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