German investor sentiment has slipped unexpectedly this month as optimism about the recovery in Europe’s largest economy loses some of its fizz.

The Mannheim-based ZEW research institute said its economic sentiment indicator had fallen by 1.7 points to 56.0 points in October. Apart from an earlier drop in July, the ZEW index had been on a steady-upward trend since late last year and in September had reached the highest for three years.