All economic indicators on economic sentiment are down, revealed the results of the latest business and consumer surveys published by the European Commission on Thursday, 28 July. These declines in indicators apply to both consumers and businesses and are across all sectors.
The Directorate-General for Economic and Financial Affairs (DG ECFIN) reported that the Economic Sentiment Indicator (ESI) plummeted in the EU, falling by 4.2 points to 97.6. A similar decline was seen in the euro area, with a loss of 4.5 points to 99, falling below its long-term average.
“The drop in the ESI in July was due to significant losses in industry, services, retail trade and consumer confidence, whereas confidence in construction decreased more mildly”, DG ECFIN said in a statement.
The decline of 2.8 points in industry confidence is the result of a deterioration in business leaders’ assessments of the current level of overall order books and their production expectations, which are at their lowest level for 20 months. Assessments of the stocks of finished goods also increased significantly, indicating weakening sales. Confidence in services also fell, by 2.9 points.
The Employment Expectations Indicator (EEI) also declined, but remained above its long-term average, with a loss of 3.6 points in the EU and 3.2 points in the euro area, reaching 106.6 and 107 respectively.
This decrease is due to weaker employment expectations in retail trade, services and industry. In contrast, the outlook for construction has improved slightly. Consumer unemployment expectations, which are not included in the overall indicator, worsened in July compared to June.
To read the results of the DG ECFIN surveys: https://aeur.eu/f/2r8 (Original version in French by Anne Damiani)