BERLIN, March 6 Reuters Investor morale in the euro zone fell unexpectedly in March for the first time since October, dragged down by a decline in expectations as the usual spring revival of the economy is in danger of being shortcircuited, a survey showed on Monday.

Sentix39;s index for the euro zone fell to 11.1 points for March from 8.0 in February. Analysts polled by Reuters had expected the index to rise to 6.3 in March.

While an index on the current situation rose for the fifth month in a row in March, to 9.3 from 10.0 the previous month, the fact that it remained in negative territory indicates the economy is, at best, in a stagnation phase, the survey showed.

An expectations index, on the other hand, took a nosedive after months of gradual improvement from doubledigit lows not seen in year, falling to 13.0 in March from 6.0 in February.

This stagnation phase could soon turn into renewed recession worries if the negative economic expectations materialize, said Sentix Managing Director Manfred Huebner in a statement.

Money supply growth remains weak and, together with the rise in interest rates, is likely to prove a serious burden on the economy in the further course of the year, he added.

The poll of 1,309 investors was conducted between March 24, Sentix said.

Reporting by Miranda Murray Editing by Paul Carrel

Source Reuters