Release Explanation: The Zentrum fur Europaissche Wirtschaftsforschung (Center for European Economic Research) report measures investor sentiment. The indicator reflects the difference between the share of Analysts that are optimistic and those that are pessimistic for the expected economic development in the region over the next six months. For example, 60% Optimistic and 40% Pessimistic will lead to a read of +20.
Trade Desk Thoughts: The Zew Economic Sentiment indicator for Germany improved again in March, for the fifth consecutive month, reaching -5.8 points. The index gained 2.3 points in March, from one month earlier.
The indicator's upward movement, which was very dynamic during the last four months, slowed down in March. However, the impression strengthens that the experts are more hopeful with respect to the economic development in Germany on a six months time horizon. The renewed interest rate cut by the ECB und lower prices for raw materials and food may explain the experts' more optimistic view.
Economic expectations for the eurozone increased in March by 2.2 points. The respective indicator now stands at minus 6.5 points
Even though the Zew headline index has seen very strong increases over the last few months, the indicator for the current economic situation, both in the Euro-zone (-90.7) and in Germany (-89.4), is sitting near record low levels. However, March was the first month that the current economic situation indicator stabilized in both regions.
Forex Technical Reaction: Immediately after the release, the euro spiked 30-pips. Since the new trading day began, the euro gained 40 pips against the dollar, and 30 pips against the pound.