German investor confidence, as measured by the index of investor and analyst expectations published by the ZEW Centre for European Economic Research, fell sharply in April to 36.3 from 48.5 in March.
This index of investor and analyst expectations aims to predict economic developments six months in advance. The April reading was worse than predictions made by economists polled in a Bloomberg News survey, which forecast a reading of 41.
The April drop was the first decline in five months. Earlier data showed that business sentiment in Germany weakened in March amid concerns that the sovereign debt crisis and the recession in the euro area, Germany’s largest export market, will weaken growth. The Bundesbank predicts that German GDP will grow by 0.4 per cent this year.
Meanwhile, inflation in the UK was unchanged in March, remaining above the Bank of England’s goal of two per cent. According to the Office of National Statistics, consumer prices rose 2.8 per cent during March compared to the same month last year.
The March reading was in line with a forecast of economists by a Bloomberg News survey.
Meanwhile, UK joblessness, as measured by International Labour Organisation methodology, increased by 70,000 to 2.56 million in the three months up till February. This is the biggest increase since November 2011.
The unemployment rate rose to 7.9 per cent from 7.8 per cent in the previous quarter. A Bloomberg News survey had forecast that the unemployment rate would remain unchanged.
Finally, in the US, near record-low interest rates helped new home construction to climb in March to their highest level in almost five years and exceed all estimates. Housing starts rose by seven per cent to a 1.04 million annual pace from a revised 968,000 rate in February.
This March increase was the highest since June 2008. Economists surveyed by Bloomberg News expected US housing starts in March to increase at the annual rate of 930,000.
Last month’s results exceeded all estimates, which ranged from 885,000 to 985,000.
This article was compiled by Bank of Valletta plc for general information purposes only.