The headline component of the ZEW Financial Market Survey that measures the balance of optimistic versus pessimistic expectations among surveyed financial analysts regarding the German economic outlook for the next six months. A reading above zero indicates that optimists outnumber pessimists, while a reading below zero indicates the opposite. The indicator is one of the first major forward-looking economic releases each month for Europe and often sets the tone for EUR trading in the days following its publication.
Example
“The ZEW Indicator of Economic Sentiment dropped to -15.0, its most negative reading in two years, putting pressure on the euro and European equity indices.”