Eurozone sentiment hits a high
By Marcin Grajewski |
July 30, 2010, Friday
|
Print Edition
Print Edition
EUROZONE economic sentiment rose strongly in July, buoyed by figures from Germany that point to a recovery as the area overcomes the sovereign debt crisis, but the outlook remains uncertain.
The European Commission said its economic sentiment indicator for the 16-nation currency area rose to 101.3 in July, a 28-month high, from an upwardly revised 99.0 in June. Economists polled by Reuters expected the index to stay at 99.0.
Economic morale is the latest in a string of indicators that have shown the eurozone continues to recover from the worst economic crisis in decades, despite turbulence on its sovereign debt market and uncertainty about the health of banks.
"July's improvement in the (eurozone) consumer and business surveys adds to the evidence that the eurozone is performing surprisingly well, but with stark divergences between countries," said Jennifer Mckeown, senior European economist at Capital Economics.
Growth may falter because of fiscal austerity measures ordered by many governments to prevent the sovereign debt crisis from spreading from Greece to other countries. Foreign demand for European goods is also expected to diminish.
Howard Archer, chief European economist at IHS Global Insight, noted that the index measuring consumers' willingness to make big buys over the next 12 months fell.
"This raises question marks whether improved consumer confidence will translate into significantly higher spending. We have our doubts given that the eurozone unemployment rate is currently at a near 12-year high of 10.0 percent," he said.
According to the Commission, economic sentiment improved thanks to an increase in the index for the export-driven industrial sector to -4 from -6 and improvement in services to 6 from 4.
The European Commission said its economic sentiment indicator for the 16-nation currency area rose to 101.3 in July, a 28-month high, from an upwardly revised 99.0 in June. Economists polled by Reuters expected the index to stay at 99.0.
Economic morale is the latest in a string of indicators that have shown the eurozone continues to recover from the worst economic crisis in decades, despite turbulence on its sovereign debt market and uncertainty about the health of banks.
"July's improvement in the (eurozone) consumer and business surveys adds to the evidence that the eurozone is performing surprisingly well, but with stark divergences between countries," said Jennifer Mckeown, senior European economist at Capital Economics.
Growth may falter because of fiscal austerity measures ordered by many governments to prevent the sovereign debt crisis from spreading from Greece to other countries. Foreign demand for European goods is also expected to diminish.
Howard Archer, chief European economist at IHS Global Insight, noted that the index measuring consumers' willingness to make big buys over the next 12 months fell.
"This raises question marks whether improved consumer confidence will translate into significantly higher spending. We have our doubts given that the eurozone unemployment rate is currently at a near 12-year high of 10.0 percent," he said.
According to the Commission, economic sentiment improved thanks to an increase in the index for the export-driven industrial sector to -4 from -6 and improvement in services to 6 from 4.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
