German investor sentiment rose more than expected in August, reaching its highest level since the outbreak of the Iran conflict in late February, as Europe's largest economy shows signs of resilience despite industrial headwinds.
The ZEW economic expectations index climbed 7.9 points to 34.2, its fourth consecutive monthly gain and well above the 30-point reading economists had forecast. The barometer for current economic conditions also improved sharply, rising 16.5 points to minus 61.1, based on responses from 185 analysts and institutional investors surveyed August 10–17.
The upbeat sentiment follows 0.2 percent economic growth in the second quarter and record monthly exports of 139 billion euros in June. The data arrives as German manufacturers and utilities face disruption from record-low Rhine water levels driving up costs and curbing production, while the economy ministry has already trimmed growth forecasts for 2026 and 2027.