FX.co ★ Germany’s ZEW Sentiment Weaker than Expected

Germany’s ZEW Indicator of Economic Sentiment eased to 58.3 in February 2026, down from January’s more than four-year high of 59.6 and below market expectations of 65. The largely unchanged level underlines how tentative the recovery remains in Europe’s largest economy. Persistent structural challenges in industry and investment continue to weigh on momentum, underscoring the need for reforms to enhance Germany’s attractiveness as a business location.

Export-oriented sectors posted moderate to strong gains in February, likely reflecting stronger-than-anticipated order intake toward the end of 2025. Sentiment improved markedly in chemicals and pharmaceuticals (up 7.5 points), steel and metals (up 8.6 points), and mechanical engineering (up 10.9 points). The outlook for private consumption also brightened, increasing by 6.0 points despite ongoing uncertainty. In contrast, sentiment worsened in the banking, information technology, and insurance sectors.

At the same time, the assessment of current economic conditions continued to firm, with the situation index rising to -65.9.