Shoppers buy fruits at a local market in Nice, France, June 8, 2023. REUTERS/Eric Gaillard/File photo
FRANKFURT – Investor morale in the euro zone fell more than expected at the start of September as Germany’s economic weakness remained a major drag on the region, a survey showed on Monday.
Sentix’s index for the euro zone declined to -21.5 points in September from -18.9 in August, weaker than the -20.0 estimate in a Reuters poll of analysts.
“The situation in Germany remains particularly precarious. Here we are measuring the weakest situation … since July 2020, when the economy was slowed by the first coronavirus lockdown,” Sentix Managing Director Manfred Huebner said.
“Germany is also weighing heavily on the economy in the euro zone as a whole … The tipping point of a global recession is less distant than one might think.”
The sub-index for future expectations in the euro zone also fell to -21.0 points, from -17.3 in the previous month. The current situation index declined to -22.0 points, its lowest level since November 2022.
Singling out Germany, Huebner said the “complete lack of economic competence in the political leadership and the enormous uncertainties for the economy caused by the energy and electricity crisis are dragging the German economy deeper and deeper into recession”.
He said that the current situation sub-index for Germany was at the lowest level since the coronavirus crisis in July 2020, adding the only time it had been lower was during the 2008/2009 financial crisis.
The poll of 1,220 investors was conducted between Aug. 31-Sept. 2.
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