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UPDATE 1-Mood among German investors at lowest in eight months
July 14, 2015 / 9:59 AM / 2 years ago

UPDATE 1-Mood among German investors at lowest in eight months

(Adds detail, economist quotes)

By Michelle Martin

BERLIN, July 14 (Reuters) - Morale among German investors weakened to its lowest level in eight months in July but think tank ZEW said the Greek debt crisis and Chinese financial market volatility were having only a limited effect on the mood in Europe’s largest economy.

Mannheim-based ZEW said its monthly survey showed economic sentiment slipping to 29.7 points from 31.5 in June. That was its lowest reading since November 2014 but was slightly above the Reuters consensus forecast for a reading of 29.0.

“Investors’ confidence only took a small hit in Germany in July, showing that the ongoing Greek crisis is hardly affecting the optimism in the euro zone’s largest economy,” said Carsten Brzeski, economist at ING.

“It seems as if German investors have taken the stance that the Greek crisis or even a Grexit would not harm the German economy and therefore rather focused on the positive impact from the still weak euro exchange rate and the latest drop in energy prices,” he added.

The Greek crisis has dented confidence among businesses and consumers in Germany of late though.

The Bundestag lower house of parliament is due to vote on Friday on whether to allow the government to open negotiations on a third bailout with Greece. While more than half of Germans back another rescue for Greece, a large majority doubt whether Athens is willing to carry out the required reforms.

ZEW President Clemens Fuest said Germany’s economic prospects were positive overall, providing some reassurance after recent data painted a mixed picture - exports have surged, output has stagnated and orders have dipped.

While the economy powered ahead late last year, it lost some momentum between January and March, when growth slowed to 0.3 percent. However, economists think it had a better run in the second quarter, with many predicting a 0.5 percent expansion.

A separate gauge of current conditions unexpectedly rose slightly, the survey of 223 analysts and investors between June 29 and July 13 showed. (Editing by Madeline Chambers)

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