For stock market professionals, the view of economic development in the next six months will brighten up a bit. However, they assess the current situation as significantly gloomier. The economy remains on course for recession.
Stock market professionals are surprisingly less pessimistic about the German economy. The barometer for their assessment of the economy in the next six months rose by 2.7 points to minus 59.2 points in October. It had previously fallen three months in a row, as the Mannheim Center for European Economic Research (ZEW) announced in its monthly survey of 176 analysts and investors. Economists had expected a further decline.
However, the stockbrokers rated the current situation significantly worse: This barometer fell by 11.7 to minus 72.2 points. “All in all, the economic outlook has deteriorated again,” said ZEW President Achim Wambach, summarizing the survey results. The probability of a decline in gross domestic product over the next six months has increased significantly.
Bank economists take a similar view. “Despite the gas price brake, the energy crisis is not off the table and the global situation is serious,” said Alexander Krüger, chief economist at Hauck Aufhäuser Lampe Privatbank AG. “The economy is on course for recession.”
Because of the energy crisis, the Bundesbank is also anticipating a noticeable economic downturn. “There are increasing signs of a recession in the German economy in the sense of a clear, broad-based and prolonged decline in economic output,” says the central bank’s monthly report. The main reason is the rising energy costs as a result of the Ukraine war. The outlook is extremely uncertain. The federal government assumes that the gross domestic product will shrink by 0.4 percent in the coming year. In the year that is coming to an end, growth of 1.4 percent should be enough.