Plus   Neg

Eurozone Economic Sentiment At 2-year Low


Eurozone's economic sentiment decreased more-than-expected in December to its lowest level since the start of 2017, extending further evidence of a broad-based slowdown in the single currency economy.

The economic sentiment index dropped to 107.3 from 109.5 in November, survey data from the European Commission showed on Tuesday. Economists had predicted a score of 108.2.

The latest reading was the lowest since January 2017, when it was at the same level. Eurozone economic sentiment has weakened steadily since December 2017.

The survey also showed that consumer confidence fell to -6.2 in December, confirming the flash estimate, from -3.9 in November. The reading was the weakest since February 2017, when it was -6.4.

The measure reflecting industrial confidence eased to 1.1, which was the lowest reading since January 2017. Economists had expected a modest easing to 3 from November's 3.4.

The confidence index for services fell to 12, it's lowest since November 2016. The measure for the construction sector dropped to a four-month low of 7.2. Meanwhile, the confidence index for the retail trade improved to 0 from -0.5.

The business climate index dropped to 0.82 from 1.04 in November. The score was the lowest since May 2017.

"Overall, the ongoing fall in business confidences suggests that the euro-zone entered 2019 with very weak momentum and points to annual GDP growth of only around 1% or so at the start of the year," Capital Economics economist Andrew Kenningham said.

Other indicators are also suggesting a broad slowdown in the euro area economy and underlying inflation remains low, damping expectations for an interest rate hike from the European Central Bank in the near term.

Private sector growth slowed to its weakest level in four years in December, the latest purchasing managers' survey showed.

Investor confidence in the euro area deteriorated for a fifth straight month in January to its lowest level in over four years, survey data from the behavioral research institute Sentix showed on Monday.

For comments and feedback contact: editorial@rttnews.com

Economic News

What parts of the world are seeing the best (and worst) economic performances lately? Click here to check out our Econ Scorecard and find out! See up-to-the-moment rankings for the best and worst performers in GDP, unemployment rate, inflation and much more.

Follow RTT