BERLIN (Reuters) - Investor morale in the euro zone deteriorated for the third month in April, a survey showed on Monday, on concerns about a slowdown in global growth as trade tensions rise between the United States and China.
Sentix’s index for the euro zone fell to 19.6 in April from 24.0 in March. The Reuters consensus forecast was for a reading of 20.0. The drop was due to lower economic expectations, which turned negative for the first time since July 2016.
“Even though the current situation is still rated as excellent ... the prospects for the future have become massively gloomier,” Patrick Hussy, managing director at Sentix, said in a note.
“The customs disputes, fuelled by U.S. President Donald Trump, are leaving their traces.”
Trump predicted on Sunday that China would take down its trade barriers, expressing optimism despite escalating trade tensions between the world’s two largest economies that have roiled global markets in the past week.
The countries have threatened each other with tens of billions of dollars’ worth of tariffs and Chinese officials have said this is not the time for negotiations.
A Sentix index for Germany also fell for the third month, falling to 24.4 from 29.1 in March.
“The German economy is facing powerful headwinds,” Hussy wrote.
“The domestic political framework conditions (Grand Coalition) are increasingly perceived as a burden, and geopolitics is also making its contribution to the export nation’s restrained optimism.”
Sentix conducted the survey of 982 investors between April 5 and 7.
Writing by Paul Carrel; Editing by Robin Pomeroy