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Sentix Index Signals Recession with Germany Casting Shadow Over Global Economy

By:
James Hyerczyk
Updated: Sep 4, 2023, 15:21 UTC

The sentix economic index for the Eurozone indicates a deepening recession, heavily influenced by Germany.

Sentix Consumer Confidence

Highlights

  • Germany’s recession affects entire Eurozone.
  • US economy shows vulnerability signs.
  • Switzerland teeters on recession’s edge.

Overview

Economic indicators in September hint at further global downturn, led predominantly by Germany’s continued recession. The “first mover” in economic signals, the sentix economic index, is showing a bleak outlook across major economies.

State of the Global Economy

Germany, reminiscent of the 2008 financial aftermath or the initial 2020 lockdown, shows its fifth successive decline in the overall index. The sentix economic index for the Eurozone, at -21.5 points, suggests that the region remains mired in a recession. This recession is particularly felt in the service sector and is set to deepen. Amid these declining economic circumstances, Germany’s economic weight pulls the entire Eurozone down, challenging the ECB’s stance.

Germany’s Stumbling Economy

Germany, once Europe’s economic powerhouse, is now grappling with challenges reminiscent of the first Corona lockdown in 2020. Political leadership’s economic missteps and uncertainties stemming from energy crises have sunk the economy further into recession. Investors remain pessimistic, expecting the downtrend to persist.

US and Switzerland: Tipping Towards a Recession?

Previously resilient, the US economy now shows signs of vulnerability. A restrictive monetary policy combined with sluggish money and credit growth might be working against its growth prospects. Meanwhile, Switzerland’s economy, teetering on the edge, reflects declining investor confidence, with concerns of an impending recession.

Short-term Forecast

The overall sentiment, based on the mentioned indicators, leans bearish. As global economies grapple with downturns and recessions, the near future appears challenging, particularly for Germany and possibly the US and Switzerland.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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