German investor confidence rose less than expected in October as relief at lower oil prices was almost entirely offset by domestic political concerns, a survey by the ZEW institute showed today.
ZEW said its German economic expectations indicator, based on a poll of 324 analysts and institutional investors, edged up to 39.4 from 38.6 in September. Economists had forecast an improvement to 42.
"Somewhat lower oil prices and the world economy's sustained robust growth had a positive impact. Ongoing uncertainty about economic policy under the new government, on the other hand, has a negative impact on growth prospects," ZEW said in a statement.
The ZEW began collecting responses for its latest survey on October 4th and closed it on October 17th, straddling the period when Germany's major parties agreed to try and form a "grand coalition" following an inconclusive September 18th election.
However, the prospective coalition of Social Democrats and conservatives has yet to clarify what economic policies it will pursue. A government is not expected to be sworn in until mid-November.
Economists said the survey was disappointing, although it suggested the expectations component of the more closely watched Ifo business climate indicator could rise slightly.