German economic expectations fall further in April amid war concerns

Economic expectations in Germany continue to decline in April as the ongoing Iran war triggers concerns over energy shortages and discourages new investments, according to the latest Zew survey results on Tuesday.

The economic expectations indicator for Germany fell to minus 17.2 points in April, dropping 16.7 points from the previous month.

The assessment of the current economic situation in Germany also declined to minus 73.7 points, which was 10.8 points below the March reading.

Achim Wambach, the president of the Zew, said the economic consequences of the Iran war for the German economy went far beyond price increases.

Wambach noted that businesses worried about long-term shortages in energy supply, which discouraged investment and weakened the effect of government stimuli.

The survey showed that expectations for the automotive sector remained largely stable at minus 44.2 points.

Prospects for the chemical and pharmaceutical industries fell 11 points compared to March, while the steel and metal production sector deteriorated by 21 points.

Economic expectations for the construction industry turned negative, reaching minus 3.8 points during the month.

The expectations index for the eurozone declined by 11.9 points in April to reach minus 20.4 points.

The assessment of the economic situation for the eurozone fell to minus 43 points, representing a decline of 13.1 points from the previous month.