- Prior -73.7
- Economic sentiment -10.2 vs -19.8 expected
- Prior -17.2
The headline reading shows that the read on business conditions are seen worsening further, with it being the worst since December last year. The fallout from the US-Iran conflict has turned around the optimistic rebound in sentiment since the turn of the year. That as Germany’s manufacturing sector is set to be hit hard by the negative impact of rising energy prices and tightening supply chains.
The bright side though is that we are seeing an improvement in the outlook reading. While still in negative territory, it is a marked rebound after having fallen to the lowest since December 2022 in April last month.
Perhaps it is a signal that financial market experts are keeping more optimistic that there will be a positive news on the US-Iran conflict. That being said, the fact that the Strait of Hormuz remains closed will continue to apply a strain to the overall German economy. So, it might be quick to jump the gun to say that the worst is over already.
