German ZEW Index Jumps to Highest Since February as Rate Hike Debate Heats Up

The latest ZEW indicator of economic sentiment in Germany rose to 34.2 in August, beating expectations and adding to the debate over another ECB rate hike.

The improvement marks the fourth consecutive monthly increase and the highest reading since February, before the Middle East conflict delivered a new energy shock.

The current-situation gauge also improved sharply, climbing to -61.1 from -77.6, although the deeply negative level still points to a weak starting position.

ZEW said strong corporate results and recent export performance helped confidence, with all surveyed industries reporting a brighter outlook.