- German ZEW Economic Sentiment arrived at 40.4 in August, down from 63.3 previous.
- The ZEW Current Situation for Germany came in at 29.3 in August vs. 21.9 in July.
- EUR/USD flirts with four-month lows near 1.1725 on downbeat ZEW data.
The German ZEW headline numbers for August showed that the Economic Sentiment Index dropped more than expected to 40.4 from 63.3 previous while missing estimates of 56.7.
Meanwhile, the Current Conditions sub-index slipped to 29.3. in August as against 21.9 recorded in the previous month and 30.0 expectations.
Separately, the Eurozone ZEW Economic Sentiment for August fell to 42.7 for the current month as compared to 61.2 previous and 72.0 consensus forecast.
ZEW President Achim Wambach said, " expectations have declined for the third time in a row. This points to increasing risks for the German economy, such as from a possible fourth covid-19 wave starting in autumn or a slowdown in growth in China.”
“The clear improvement in the assessment of the economic situation, which has been ongoing for months, shows that expectations are also weakening due to the higher growth already achieved,” Wambach added.
FX market reaction
The euro showed little to no reaction to the downbeat ZEW Surveys, as EUR/USD flirted with multi-month lows of 1.1726 amidst persistent US dollar demand.
