Eurozone investor sentiment falls again in October - Sentix

Eurozone investor morale fell for the third month in a row to its lowest level since May 2020, according to a survey released on Monday.

The Sentix index for the eurozone slumped to -38.3 points in October from -31.8 in September.

Its expectations index also fell to -41.0 from -37.0, hitting its lowest value since December 2008 at the height of the financial crisis caused by the banking industry – “a clear warning of a very deep economic dislocation”.

The index on the current situation fell to -35.5 in October from -26.5 in September and hitting its lowest since August 2020.

"The ongoing uncertainties about the gas and energy situation in winter have not diminished due to the attack on the Nordstream pipelines," Sentix Managing Director Manfred Huebner said in a statement.

"In addition to the economic worries, there is now also an increasing probability of an escalation of the military conflict in Ukraine. Globally, there is little reason for hope."

“In previous downturns, the monetary and fiscal policy players would have stepped into action at this point at the latest to provide light at the end of the tunnel.”

Huebner said this could not be implemented now as monetary policy was on a restrictive course in order “to at least not inflame the considerable inflation any further”.

“However, the measures taken so far are unlikely to be sufficient to dampen either inflation or the downturn. Governments are trying to curb the harmful effects of high energy prices on consumers with considerable fiscal measures,” he added.

“But the supply problems in the energy market are not being addressed. As a result, the important economic expectations also continue to fall!”

Reporting by Frank Prenesti for Sharecast.com