Published On: Tue, Aug 22nd, 2017

Germany heading for economic NIGHTMARE as confidence PLUNGES

The outlook for the eurozone powerhouse plunged for the third month in a row, according to the respected ZEW economic sentiment index.

The think-tank admitted there was a “high degree of nervousness over the future path of growth”.

Germany’s exports are suffering after the euro reached a two and a half year high against the US dollar.

The economy is largely driven by overseas sales, particularly from the car industry.

But in a double blow to the sector, top auto brands are being investigated for collusion over the diesel-emissions scandal.

Earlier this month Germany’s leading stock index the DAX sank to levels not seen since April, as nerves around carmakers and declining exports have taken hold.

The ZEW think-tank’s economic sentiment index dropped 7.5 points in August to 10 points – well below expectations of a reading of 15.

The dire reading put pressure on the euro, which fell against the US dollar after the survey was released.

ZEW president Achim Wambach said: “The significant decrease of the ZEW economic sentiment indicator reflects the high degree of nervousness over the future path of growth in Germany.

“Both weaker than expected German exports as well as the widening scandal in the German automobile sector in particular have helped contribute to this situation.”

But Mr Wambach tried to put a brave face on the figures and added: “The economic outlook still remains relatively stable at a fairly high level.”

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