German Investor Sentiment Rises Despite Brexit and Covid-19 Concerns

Investor sentiment in Germany increased unexpectedly in September, the ZEW Institute for Economic Research said on Tuesday, indicating confidence in recovery from the Corona crisis despite concerns related to stalled Brexit talks and a spike in new cases of the virus.

The index of economic sentiment for investors increased to 77.4 from 71.5 points in the previous month, surpassing expectations in a Reuters poll that the index will decline to 69.8 points.

“The ZEW index rose again, which indicates that experts still expect a remarkable recovery of the German economy,” said Achim Vampach, head of the institute. “The stalled Brexit talks and the increase in COVID-19 cases cannot undermine positive sentiment,” he added.

The German economy has been recovering since May when lockdown measures aimed to cap the outbreak of the Coronavirus were lifted. But activity remains below pre-crisis levels and economists expect a slow recovery.

The economic recovery is supported by a rescue program approved by the Conservatives led by Chancellor Angela Merkel and their coalition ally, the Social Democratic Party.