The analysts and institutional investors who participate in the ZEW Survey continue to be pessimistic about current conditions in the German economy. The balance between optimists and pessimists has average about -70 for the past year or so, indicating that the percentage of optimists has been roughly 15%, while that of the pessimists has been 85%. The first chart shows the balance of optimists over pessimists for current conditions and for the six month's outlook.

The participants have tended to be more optimistic regarding the outlook six months ahead. But even here they are loosing heart. While the balance of optimists over pessimists rose to 19.5% in June from 13.9% in May, the balance is will below the 47.4% of June, 2004. The actual percentage of optimists rose to 59.75%in June from 56.95 in May, but was well below the 73.7% percentage of optimists in June 2004.

The recent decline in the euro may have helped to raise the June percentage of optimists regarding the six month's outlook, but the more recent rise in the price of oil is likely to have an opposite effect in the months to come. The daily value of the Euro in U. S. dollars and the dollar price of a barrel of Brent Crude Oil since early this year are shown in the second chart.