Eurozone Investor Morale Hits Almost 10-year High

Investor sentiment in the euro zone improved more than expected in March, hitting its highest level in almost 10 years on Monday, as concerns that global political risks could end an economic upswing dissipated.

The Frankfurt-based Sentix research group’s euro zone index rose to 20.7 points, reaching its highest level since August 2007. It was above the consensus reading of 18.5 in a Reuters poll of analysts. EUSTCS=ECI

“All the expectation components for the global economic regions rose and cast the decline of last month in a new light,” Sentix said in a statement. “Therefore the potential threat of a sudden halt to the economic recovery is off the table.”

The index had last month edged down to 17.4 from 18.2 in January on concerns that U.S. President Donald Trump’s policy course would weigh on the global economy.

A sub-index measuring investor assessment of the current situation in the euro zone also rose to its highest level since May 2011.

An index tracking Germany, the euro zone’s largest economy, rose to 34.1 from 31.3 in February. The indices for the United States and Japan also rose.

“Trump’s motto ‘Make America great again’ is having an effect,” Sentix wrote.

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U.S. stocks have risen to record highs since Trump’s election after he vowed to remove some of the regulations introduced after the financial crisis and to boost spending on the military and infrastructure.

“In addition to the main regions, the positive economic momentum for emerging markets is retained,” Sentix said. It noted that

Sentix polled 1,081 investors March 2-4.

Reuters

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell