Eurozone Investor Confidence Strongest In A Year: Sentix

(RTTNews) - Euro area investor morale rose to the highest level in a year in June, driven by the economic recovery in Germany, survey data from the behavioral research institute Sentix showed Tuesday.

The investor sentiment index rose to +0.2 in June from -8.1 in May. This was the highest reading since June 2024 and remained well above economists' forecast of -6.0.

Sentix said the June data indicates an upturn in the European economic region. The improvement in the expectations indicator gives cause for hope, the think tank observed.

"Overall, the global economy is breathing a sigh of relief, even if the negative impetus following the US tariff shock has not yet been fully absorbed globally," Sentix said.

Assessment of the euro area current situation as well as expectations strengthened in June, the Sentix survey revealed. The current situation index climbed to -13.0 in June from -19.3 in the previous month. The score was the highest since June last year.

Similarly, the expectations indicator advanced to 14.3 from 3.8 in May.

The upswing scenario is likely to reduce the European Central Bank's future room for manoeuvre for further interest rate cuts.

"The central bank is likely to consider itself to be in the comfort zone with its interest rate policy for the time being," Sentix said. Despite the economic upturn, the sentix inflation barometer is showing relief.

In Germany, the investor confidence index climbed to -5.9 in June from -16.0 in the previous month. The reading was the highest since March 2022.

With the fourth increase in a row, the current situation index improved to -26.8 in June from -35.3 in May. However, the score still suggests that the economy is doing badly.

By contrast, the expectations index climbed markedly in June, to 17.5 from 5.5, indicating an economic upturn.

Sentix noted that Germany is benefiting from the fact that the EU has not signaled any imminent escalation in the customs dispute. Moreover, the new German government is making its first moves, particularly in foreign and migration policy.