(Adding analyst, context)
BERLIN, April 13 (Reuters) – Investor sentiment in Germany fell unexpectedly in April, the ZEW economic research institute said on Tuesday, citing growing concerns that private consumption could be depressed as Europe’s biggest economy got closer to extending lockdown measures.
ZEW said the investor’s economic sentiment survey fell to 70.7 points, the first drop since November 2020, from 76.6 the previous month. A Reuters poll forecasted the increase to be 79.0.
“Financial market experts are somewhat less euphoric than the previous month,” said ZEW President Achim Wambach in a statement. “The ZEW economic sentiment indicator, however, is still at a very high level and the current situation is considered much more positive than in March.”
Germany tightened lockdown measures in December to fight a third wave of coronavirus infections and the economy is expected to shrink in the first three months of this year.
Hopes for a return to growth in the second quarter have been tempered by expectations that restrictive measures will be extended beyond mid-April to stop an exponential rise in infections.
“The ZEW indicator is preparing us for another delay of the anticipated economic recovery,” said Thomas Gitzel, chief economist at VP Bank Group. “The limitation on gross domestic product growth in the second quarter is too high. The ZEW headline tells us that the bar must be lowered. “
Economists earlier this year predicted German growth of 3% based on expectations of a slow return to normal economic activity.
The ZEW gauge for current conditions rose to -48.8 points from -61.0 the previous month, confirming an assessment that the German economy remains in relatively good shape as increasing demand for goods from China and the United States keeps factories humming.
“Concerns about a tighter lockdown have led to lower expectations for private consumption,” said Wambach. However, the export prospects are better than the previous month. (Written by Joseph Nasr; editing by Maria Sheahan, Larry King)