Chapter 5: Europe and Germany: The Domestic Market Remains Relevant for Us!

Germany's economic data naturally play a major role on the financial markets – even for internationally oriented investors. After all, Germany is the fourth largest economy in the world and the largest in the Eurozone. In view of the close economic ties between Germany and its neighbouring countries, such as France, the Netherlands, Austria and also Italy, the country's trends thus determine those in core Europe, at least to a large extent. In this respect, as a heavyweight in the Eurozone, the country can also help determine the ECB's monetary policy orientation – although this was certainly no longer quite the case in recent years. However, the market capitalisation on the stock exchanges is comparatively low, so that market trends here can hardly provide impulses on other stock exchanges.