German investor confidence has fallen for the sixth consecutive month, hitting a 21-month low as markets expect the pace of economic growth to slow, a survey showed Tuesday.
The ZEW institute's confidence index, which measures professional investors' outlook for the coming six months, was down to minus 7.2 points in October from minus 4.3 in September. That was its lowest level since January 2009, when it stood at minus 31.
The indicator is now well below its historical average of 27 points, but this month's fall was far more modest than the index's 18.3 percent slide in September.
A strong export performance helped Germany, Europe's biggest economy, to growth of 2.2 percent in the second quarter over the previous three-month period _ leading the 16-nation eurozone to 1 percent growth. However, there have been mounting concerns recently that cooling growth elsewhere in the global economy could weigh on exports.
The latest decline in investor confidence "indicates that compared to the period of rapid recovery economic growth is likely to slow down in the next six months," ZEW said in a statement.
"More than half of the financial market experts expect no change of the economic situation in Germany within the next half year," it added. "Nevertheless, weak economic dynamics in the United States and in some countries of the eurozone remain major risks."
While there are clouds on the horizon, investors' view of the current economic situation rose again in October. A subindex measuring that rose to 72.6 points from 59.9 in September, hitting its highest level since September 2007.
The worsening outlook "seems to be driven by concerns about the impact of a stronger euro, austerity measures and slower global trade," said Carsten Brzeski, an economist at ING in Brussels.
The ZEW index is traditionally volatile, and Brzeski cautioned that experience shows "negative ZEW readings do not necessarily signal an imminent downturn."
He pointed to increasing order backlogs, strong business confidence and a resilient labor market as evidence that "for the time being, the German economy continues to cruise along."
The Center for European Economic Research, or ZEW, questioned 282 analysts between Oct. 4 and Oct. 18 for this month's survey.
Germany is the world's second-biggest exporter after China. On Tuesday, Germany's BGA exporters' association said it expects exports to increase by 16 percent this year to euro937 billion ($1.3 trillion), the strongest increase in a decade. Imports should rise by 17 percent to euro789 billion, it said.
Exports should grow by as much as 7 percent and imports by up to 8 percent in 2011, the group added.
"We can expect a return to the pre-crisis level in the course of the first half of 2011, much earlier than could have been expected at the beginning of this year," BGA president Anton Boerner said.