German investor morale hits two-year high in May

By Maria Martinez

BERLIN (Reuters) -German investor morale improved more than expected in May, reaching its highest level since February 2022, when Russia invaded Ukraine, the ZEW economic research institute said on Tuesday.

The economic sentiment index rose to 47.1 points from 42.9 in April. Analysts polled by Reuters had expected a May reading of 46.0.

"Following the stronger-than-expected growth of the German economy in the first quarter of 2024, both the assessment of the current situation and economic expectations have become more favourable," said ZEW president Achim Wambach.

The assessment of the economic situation in Germany rose to minus 72.3 points from minus 79.2 in the previous month.

Signs of an economic recovery are growing, bolstered by a better assessment of the overall euro zone and of China as a key export market, Wambach added.

"The increased optimism is reflected in particular in the sharp rise in expectations for domestic consumption, followed by the construction and machinery sectors,” Wambach said.

(Reporting by Maria Martinez, writing by Rachel More, editing by Andrey Sychev, Madeline Chambers and Bernadette Baum)

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