Investor confidence in Germany posted its second consecutive monthly gain in October, a survey released Tuesday showed, as the nation's economics ministers ruled out a recession in Europe's biggest economy.
The Mannheim-based ZEW economic research institute said its index gauging the mood among analysts and institutional investors edged up to a better-than-forecast minus 11.5 points this month from minus 18.5 in September.
Analysts had expected the forward-looking indicator to post a more modest gain to minus 15.
The release of the ZEW survey follows signs of a more stable climate emerging across European financial markets after the European Central Bank (ECB) announced plans to launch an unlimited government bond-buying programme aimed at shoring up nations at the centre of the eurozone debt crisis.
“The indicator's rise shows that risks for the German economy have somewhat diminished according to the financial market experts,” said ZEW President Wolfgang Franz.
“This could well be explained by the decreasing uncertainty on the financial markets during the last weeks,” he said.
Based on a survey of 288 analysts and investors, the survey points to economic developments in Europe's biggest economy six months down the track.
But a ZEW gauge measuring how investors see the current conditions in the country dropped for the fifth consecutive month, slipping to 10.0 in October from 12.6 last month.
Economists expect the German economy to lose momentum in the run-up to the end of the year as the debt crisis hits the nation's growth rate.
“Slightly more experts still expect the German economy to cool down instead of brightening up,” said Franz.
Echoing his remarks, Economics Minister Philipp Roesler told dpa the German economy faced a difficult period.
“As a result, we are well-advised to continue to do everything to strengthen our competitiveness,” Roesler said.
But he rejected the notion that Germany would follow large parts of the eurozone into recession.
“We are still talking about growth,” he said.
However, Roesler warned: “If 60 per cent of our exports go to Europe and 40 per cent go to the eurozone countries, it is clear that the debt crisis cannot pass us by without a leaving a mark.”
Roesler went on to say that this was also the case with the slowdown in the world economy.
The German government is set to unveil its latest growth forecasts on Wednesday. - Sapa-dpa