Optimism in Germany is roaring and consumers across the euro zone are starting to become less gloomy. But the latest hard economic data are a reminder of the difference between confidence that things are going to get better, and the hope that they will.
For the moment, we only have the latter.
Friday’s German Ifo business climate survey topped even the highest expectations, as did the ZEW economic sentiment indicator on Tuesday. Euro zone consumer confidence improved this month too, and the mood in financial markets has been largely buoyant since the start of the year.
The hope is that will translate into a growing euro zone economy, but that isn’t happening yet.
“The optimism is out of step with what current real evidence and logic tend to suggest,” argues David Brown of New View Economics.
“German economic confidence surveys seem to be showing more signs of economic spring, but the economy is still struggling with a massive millstone round its neck. The rest of the beleaguered euro zone economy.”