German investor confidence drops unexpectedly
BERLIN (AP) — German investor confidence in Europe's largest economy slipped unexpectedly this month over worries that growth will cool over the next six months, a survey showed Tuesday.
The ZEW institute said its monthly confidence index fell to minus 15.7 points in November from minus 11.5 last month. Economists had expected a third straight monthly increase, albeit only a small one.
A negative figure means the investors surveyed are, on average, pessimistic about the economy's outlook for the next half year, while a positive number denotes optimism.
ZEW said that this month's drop, which keeps the index below the historical average of plus 23.3 points, may be due to recent disappointing indicators such as poor industrial orders.
Official figures on Thursday are expected to show that Germany's economy grew in the third quarter, though only modestly. Many economists think it may slacken further over the winter months.
Germany enjoyed robust growth over the past two years but the debt crisis that has pushed several European countries into recession is hitting confidence as well as exports.
"Prevailing recessionary developments in the eurozone impact the German economy via foreign trade and a lack of confidence," ZEW head Wolfgang Franz said. "This is likely to be a burden for economic growth in Germany during the next six months."
The ZEW, or Center for European Economic Research, surveyed 263 analysts between Oct. 29 and Nov. 12.
The German government's panel of independent economic advisers last week forecast that the economy will grow by only 0.8 percent this year and next.
More than half of Germany's exports, a traditional strength of its economy, go to other countries in the 27-nation European Union — but its export performance has been kept buoyant so far by strong demand from Asia, Russia, the United States and elsewhere, which more than offset falling sales to southern European strugglers.
The country's main exporters association, the BGA, predicted Tuesday that total German exports will climb 4 percent this year to a little over €1.1 trillion ($1.4 trillion). Imports, it said, will rise 3 percent to €929 million.
BGA head Anton Boerner said world trade should pick up speed next year so long as protectionist measures in various parts of the world don't get in the way. The group forecast that, as a result, German exports could grow another 5 percent in 2013.