Frankfurt, Germany (4E) – Germany’s investor confidence climbed in February to its highest level in almost three years, beating economists forecast and adding to signs that the largest economy in Europe is on its way to recovery.
The closely watched investor confidence index by the Center for European Economic Research, also known as ZEW, rose to 48.2 points in February from 31.5 points in the previous month.
The Bundesbank said on Monday that the German economy could expand this quarter amid increasing confidence and strengthening of the global economy. An expansion in the current quarter means the country will have avoided a recession which is being felt in most of the eurozone nations.
Germany’s gross domestic product (GDP) shrank at a faster-than-expected rate of 0.6 per cent in the final three months of 2012 as companies postponed investment as uncertainty over the sovereign debt crisis in Europe remains
The country’s central bank in December forecast a 0.4 per cent GDP growth in 2013 compared to the 0.7 per cent gain in the previous year. That figure is still more optimistic than the 0.3 per cent contraction predicted by the European Central Bank (ECB) for the 17-nation eurozone.
In the ZEW survey, analysts and institutional investors were asked about their current assessment of Germany’s current economic situation and their outlook for the upcoming months.
A sub-index that gauges the financial industry’s view of Germany’s current economic situation fell by 1.9 points to 5.2 points this month, its lowest level since the middle of 2010.