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German economic sentiment improves on trade optimism, ECB stimulus

Germany's economic outlook improved more than expected in September amid signs of easing global trade tensions and the European Central Bank's stimulus package, according to a survey by research institute ZEW.

The economic sentiment indicator came in at minus 22.5 points this month, compared with minus 44.1 points in August, when the index hit the lowest level since the end of 2011.

The consensus estimate of economists polled by Econoday was for a reading of minus 38.0 points.

The improvement "is by no means an all-clear concerning the development of the German economy in the next six months," ZEW President Achim Wambach said.

However, the economic outlook benefited from the trade conflict between the U.S. and China not intensifying and hopes of avoiding a no-deal Brexit. In addition, the ECB's stimulus package should help reduce the economic risks in the eurozone, Wambach said.

The indicator assessing the German economic situation fell to minus 19.9 points from minus 13.5 points, compared with the Econoday consensus of minus 15.0 points.

Meanwhile, the indicator assessing market sentiment regarding economic development in the eurozone improved to minus 22.4 points from minus 43.6 points.