German investor morale back in positive territory - ZEW

BERLIN (Reuters) - German investor sentiment was in positive territory in January for the first time since the Ukraine war began as signs point to a milder recession over the winter months than initially feared, the ZEW economic research institute said on Tuesday.

The institute's economic sentiment index rose to 16.9 from minus 23.3 in December, beating expectations by analysts polled by Reuters of a reading of minus 15.0.

"For the first time since February 2022, the month in which the war in Ukraine began, the indicator points to a noticeable improvement in the economic situation over the next six months," said ZEW President Achim Wambach.

Wambach said a more favourable situation on the energy markets and energy relief measures by the German government in particular contributed to the leap in January.

The prospect of easing inflation lifted expectations for consumer-related sectors while the lifting of COVID-19 restrictions in China has brightened the picture for export-oriented and energy-intensive sectors, he added.

German inflation eased further in December, with consumer prices rising by 9.6% year on year in harmonised terms, the federal statistics office said, after an annual harmonised inflation rate of 11.3% in November and 11.6% in October.

(Reporting by Miranda Murray and Rachel More; editing by Matthias Williams)