FRANKFURT (Reuters) – Investor morale in the euro zone fell in January to its lowest in more than a year, a survey showed on Monday, with Germany remaining a continued drag on the bloc.
The Sentix index for the euro zone dropped to -17.7 in January from -17.5 in December. That is the lowest level since November 2023, though it was not as bad as the -18.0 forecast by analysts polled by Reuters.
“In the euro zone, the economic engine is threatening to freeze up for the long-term,” the survey said, adding that Germany’s recessionary economy “is hanging on to the euro zone like a lead weight”.
The survey of 1,121 investors from Jan. 2 to Jan. 4 showed expectations slightly improved to -5.0 in January from -5.8 points last month.
But that gain was outweighed by the worsening view of the current situation, which sagged to -29.5 in January from -28.5 in December. That is the lowest level since October 2022.
The survey also found that Germany – Europe’s largest economy and one facing federal elections next month – appears to be in recession and is unlikely to emerge from it any time soon.
