Tuesday's session brought ZEW Economic Sentiment figures. The ZEW Indicator of Economic Sentiment for Germany recorded a decrease of 2.6 points in February 2018 and currently stands at 17.8 points. The indicator thus still remains slightly below the long-term average of 23.7 points. The assessment of the current economic situation in Germany decreased by 2.9 points, with the corresponding indicator currently standing at 92.3 points. “The latest survey results continue to show a positive outlook for the German economy. The assessment of the current economic situation is still on a very high level and the economy is expected to improve in the coming six months. Economic growth in Germany is substantially driven by the very good development of both the global economy and private consumption. Inflation expectations for Germany and the Eurozone have also started to increase,” comments ZEW President Professor Achim Wambach.

The financial market experts’ sentiment concerning the economic development of the Eurozone fell by 2.5 points, leaving the corresponding indicator at a level of 29.3 points. The indicator for the current economic situation in the Eurozone improved slightly in February. The indicator currently stands at 57.7 points, which corresponds to an increase of 1.3 points compared with the January result. The economic expectations for the Eurozone thus continue to be fairly positive. The positive economic outlook for Germany and the Eurozone is reflected in the fact that inflation expectations are rising. About two thirds of the survey participants expect the inflation rate in Germany and the entire euro area to increase in the next six months.

From Eurozone, on Wednesday, German and French PMI figures were released. French private sector activity slowed but remained solid in February, according to survey data released on Wednesday. The preliminary reading of the Markit services purchasing managers’ index came in at 57.9 this month from 59.2 in January. Economists had forecast a reading of 59.1. The manufacturing PMI dropped to 56.1, compared to expectations for 58.1 and from 58.4 a month earlier. The composite output index, which measures the combined output of both the manufacturing and service sectors ticked down to 57.8 from 59.6, against expectations for 59.4.

Germany’s private sector continued to see strong growth in February, despite the pace of expansion slowing down from the near seven-year high seen during the opening month of the year, according to the latest PMI® survey from IHS Markit. Flash Germany Services PMI Activity Index at 55.3 (57.3 in January), what is a 3-month low. Flash Germany Manufacturing PMI at 60.3 (61.1 in January), what is a 6-month low. While February’s flash PMI figure was down on January’s recent high, it still continued to point to a robust pace of private sector expansion in the eurozone’s largest economy. The performance so far in the first quarter remains better than that seen in final three months of 2017, which saw GDP rise 0.6%.

Thursday was marked by German Business Climate figures. German business confidence fell more than expected in February while remaining at a high level, a survey showed on Thursday, suggesting that Europe’s biggest economy is set for solid growth in the first quarter of this year. The Munich-based Ifo economic institute said its business climate index, based on a monthly survey of some 7,000 firms, fell to 115.4 from 117.6 in January.

This week markets will be looking at:

German Prelim CPI (Tuesday)

Spanish Flash CPI (Tuesday 9:00)

CPI Flash Estimate (Wednesday 11:00)

Spanish Manufacturing PMI (Thursday 9:15)

Spanish Unemployment Change (Friday 9:00)