German financial market confidence leapt in January as investors welcomed strong order levels, low interest rates and positive data from the US, the ZEW research institute said today.
The group's confidence index soared to 15.4 points from 4.3 points in December, its highest level since July 2010, as the biggest economy in Europe geared up for more growth in 2011.
Analysts had expected the volatile German index to reach a more modest 8 points, and the new level remained below the historical average of 26.8 points.
The ZEW indicator, based on a survey of 284 analysts and institutional investors, suggested that 'financial market experts expect the dynamic growth of the German economy to continue,' a statement said.
'This development is backed by current data on incoming orders in the German industry,' it added.
In November, German industrial orders gained a surprise 5.2% from the level in October, provisional data showed on January 6.
ZEW president Wolfgang Franz also highlighted the 'currently low level of real interest rates' that should boost demand for German goods and said good data from the US had raised hopes that global growth would continue.
German growth should get an additional boost from increased job security, which stimulates domestic consumption, Franz added.
Meanwhile, investors' assessments of their current situation changed little, rising by just 0.2 points to an indexed 82.8 points, the highest level since August 2007.
