FRANKFURT, Germany (AFP) —Investor sentiment in Germany is still on the increase, amid confidence that Europe’s biggest economy is robust enough to withstand the refugee crisis and the economic slowdown in China, a leading survey said yesterday.

The investor-confidence index, calculated by the ZEW economic institute, rose for the second month in a row to 16.1 points in December, after a 10.4-point increase in November, the think tank said in a statement.

“The large influx of refugees is above all a major challenge facing policymakers and civil society in Germany… (and) the economic slowdown in emerging markets is exerting pressure on the German export industry,” said ZEW President Clemens Fuest.

“Overall, however, confidence is growing that the German economy is sufficiently robust to meet these challenges in the coming year,” Fuest said.

For the survey, ZEW questions analysts and institutional investors about their current assessment of the economic situation in Germany, as well as their expectations for the coming months.

The sub-index measuring financial market players’ view of the current economic situation in Germany was largely unchanged, edging up by 0.6 points to 55.0 points, ZEW said.

Analysts said the headline index was slightly higher than they had expected.

The “solid rise… suggests that the economy is faring pretty well”, said Jennifer McKeown at Capital Economics.

The data “support earlier survey evidence that neither the Volkswagen scandal nor the Paris attacks have taken a significant toll on the German economy”, she said.

Nevertheless, the current level was still lower than that seen during the first half of the year, so it could point to a slowdown in growth, McKeown continued.

“We maintain our forecast that German GDP (gross domestic product) growth will slow from 1.5 percent this year to about 1.2 per cent in 2016,” she said.

ING DiBa’s Carsten Brzeski said investors appeared to have “somehow overcome their disappointment after the European Central Bank meeting and have become more optimistic about the growth prospects of the German economy”.

At its meeting earlier this month, the ECB trimmed back one of its key interest rates slightly and extended its bond purchase programme for another six months, but investors had been expecting much more robust action to tackle the stubbornly-low-level of inflation in the euro area.