ECONOMY

Improving eurozone GDP boosts investor sentiment, says ZEW economist

Improved GDP data is the main reason for a big improvement in eurozone sentiment in September and the worst of the common currency area’s debt crisis seems to be over, an economist at Germany’s ZEW economic research institute said on Tuesday.

“Maybe the strongest surprise (from the data) was that the euro zone is out of recession,” said ZEW economist Michael Schroeder after the institute’s survey of German and eurozone sentiment showed better than expected increases.

“An increase in GDP is one of the most important factors to relieve government budgets. I think therefore the worst seems to be over (for most of the eurozone) but not for Greece.”

ZEW’s monthly poll of investor and analyst sentiment for Germany rose to 49.6 from 42.0 in August and for the eurozone to 58.6 from 44.0.

Germany’s sentiment reading, the highest since April 2010, was buoyed by the improving situation in the rest of the eurozone which is good news for German exports, Schroeder said. [Reuters]