ZEW Economic Expectations

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Definition

A leading indicator of economic health based on surveyed institutional investors and analysts. The survey asks respondents to rate the 6-month economic outlook for the nation. A reading above 0.0 indicates optimism while a reading below 0.0 implies pessimism.

Importance

The indicator incorporates current economic conditions in constructing a 6-month outlook. Since investors and analysts are highly informed regarding economic conditions, changes in their sentiment can be a reliable forecast of future economic activity.

Market Impact

If the current reading is an improvement from the past figure or is better than forecasted, it could have a positive impact on the nation’s currency.

Relevant Links:

Center for European Economic Research - http://www.zew.de/en/

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