German investor negativity eases but experts still cautious

12th May 2026 10:01

(Sharecast News) - Investor sentiment in Germany improved slightly over the past month, according to the latest ZEW survey, but remains firmly in negative territory amid ongoing uncertainty regarding geopolitical developments in the Middle East.

The ZEW economic sentiment indicator came in at -10.2 in May, up from a three-year low of -17.2 in April. The consensus estimate was for a further deterioration to -19.8.

The confidence tracker is published each month by the Centre for European Economic Research, otherwise known as ZEW, and surveys experts across the banking, insurance and financial sectors across the country, who are asked about their six-month expectations concerning the economy, inflation rates, interest rates, stock markets as well as exchange rates.

The indicator fell below zero in March for the first time since Spring 2025 as the outbreak of war between the US-Israel alliance and Iran eroded risk appetite across financial markets worldwide and sent oil prices soaring to a four-year high.

While inflation expectations have risen in recent months, the ZEW survey found a slight moderation in projections by participants in May: some 71.7% still expect an increase in inflation across Germany over the coming six months, though that was down 14.1 points from April, while 21.2% predict no change, up 12.8 points over the month.

Respondents also predict further gains on Germany's DAX index, despite the equity benchmark already trading within 2% of its record high reached in January: 36.2% expect the index to rise in the coming six months (+2.3 points), while only 19.0% expect a fall (-1.1 points).