German Investor Confidence Drops to 10-Month Low

In a surprise to economists, investor confidence in Germany fell more than expected in April on the back of sluggish consumer spending and rising oil prices, putting it at a 10-month low in May. The ZEW Center for European Economic Research, based in Mannheim, said its index of institutional investor and analyst sentiment fell from 49.7 to 46.4 in April. Analysts surveyed by Bloomberg had expected a fall, but only to 49. The numbers have cast doubt on the strength of Germany's recovery, which has been based almost entirely on exports. On Monday, Germany's central bank, the Bundesbank, said the economy was showing no signs of a "self-sustaining" recovery since rising unemployment and uncertainty about the future are causing people to save rather than spend. The German economy grew by 0.4 percent during the first quarter. While that was the fastest in three years, it was driven entirely by demand from abroad, according to government figures.