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German investor sentiment plunges to four-year low on Brexit fears
[FRANKFURT] Investor confidence in Germany plummeted in July to its lowest level in nearly four years on concerns about the fallout for Europe's biggest economy from the British vote to quit the European Union, a leading survey showed on Tuesday.
The investor confidence index calculated by the ZEW economic institute plunged by a bigger-than-expected 26 points to minus 6.8 points in July, its lowest level since November 2012, the think tank said in a statement.
"The Brexit vote has surprised the majority of financial market experts. Uncertainty about the vote's consequences for the German economy is largely responsible for the substantial decline in economic sentiment," said ZEW president Achim Wambach.
"In particular, concerns about the export prospects and the stability of the European banking and financial system are likely to be a burden on the economic outlook," he said.
In a seismic vote on June 23, 52 per cent of Britons voted to leave the EU.
For the survey, ZEW questions analysts and institutional investors about their current assessment of the economic situation in Germany, as well as their expectations for the coming months.
The sub-index measuring financial market players' view of the current economic situation in Germany decreased by 4.7 points to 49.8 points in July, ZEW said.