Germany ZEW Current Conditions Miss as Iran Conflict Weighs

Germany's ZEW current conditions index printed at -77.6 for July, slightly better than the -77.8 consensus but still deep in negative territory.

The reading reflects an economy battered by the Middle East conflict, with the war's escalation once again hitting industrial sentiment. The outlook component, however, ticked higher. ZEW President Professor Achim Wambach said the reforms appear to be taking hold, particularly in export-oriented sectors and domestic demand, which both show sustained growth. He also warned that uncertainty tied to the Iran conflict and oil prices remains a key risk to the recovery.

For the European Central Bank, the focus stays on inflation. Price pressures are drifting ahead of the summer break, and the ECB is expected to hammer that theme at its meeting later this week. The bigger question – how the economic and inflation outlook will hold up by Q4 2026 – hangs on whether the US-Iran standoff drags on.