German economic confidence weakened sharply to the weakest level since December 2012 as geopolitical tensions weighed on analyst expectations, the results of a closely watched survey from the Mannheim-based Centre for European Economic Research/ZEW showed Tuesday.
The indicator of economic sentiment plunged by 18.5 points to 8.6 in August, while it was forecast to drop to 17.
This was the eighth consecutive decline, with the index hitting the lowest since December 2012, when the reading was 6.9. 
Similarly, assessment of current economic situation declined in August, with the corresponding index falling to 44.3 from 61.8 in July. The reading was the lowest since January and well below the expected score of 54.
Industrial output and incoming orders now suggest markedly reduced investment from the part of German firms against the backdrop of uncertain sales prospects. The institute said economic growth in Germany will be weaker in 2014 than expected.
Meanwhile, the ZEW economic sentiment for the Eurozone declined significantly in August. The indicator dropped by 24.4 points to 23.7. Likewise, the current economic situation index fell 2.3 points to minus 33.8.
