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Construction confidence also registered a slight improvement while confidence in retail trade saw a small deterioration. As to consumers, confidence remained unchanged in both areas. Among the larger EU Member States, economic sentiment improved in Germany, Italy, Poland and the UK, remained more or less steady in France, and deteriorated slightly in Spain. The marked improvement in Italy was more of a technical nature, following the strong drop of the indicator in June. As for the UK, where a large part of the survey data was collected after the terrorist attacks of July 7, the significant rebound of the indicator suggests that these events did not seriously affect economic sentiment. Following its stabilisation last month, in July industrial confidence in the EU improved for the first time since September of last year. In the euro area, where the indicator had already seen an improvement last month, the recovery was confirmed in July. In both areas, the rise in the indicator amounted to 2 points. The increase of the indicator was predominantly due to a significant improvement in the assessment of order books which, in turn, appear to have been boosted by export order books. Industry managers’ assessment of stocks of finished products also turned more optimistic. Production expectations, the third component of the confidence indicator, improved slightly in the EU and remained stable in the euro area. Services confidence improves in both areas Confidence in the services sector improved in July. The indicator increased by 3 points in the EU and by 2 points in the euro area. In spite of the increase in July the indicator remains, however, below the level recorded 12 months ago. Over the past one and a half years the indicator has shown fairly volatile behaviour, making it difficult to discern a clear tendency. The rise in services confidence can be attributed to a much more positive assessment of the current business situation and of the evolution of demand in recent months. Expected demand showed little changes in comparison with the values of June. Results at the EU and euro area level were strongly influenced by a marked increase in services confidence in Italy. While this seems to be mainly a technical rebound following the sharp decline in the previous month, the EU and euro area indicator would have risen also without Italy, as other large Member States also recorded improvements in services confidence. In particular, with the exception of Spain confidence increased in all larger EU Member States Consumer confidence unchanged in both the EU and the euro area
Consumer confidence remained unchanged for the second month in a row. Since the beginning of last year the indicator has been fluctuating within a small band of -10 and -13 for the EU and of -13 and -15 for the euro area. The stability of the overall confidence indicator masks some divergent developments at the level of the underlying components. Specifically, households’ expectations of the general economic situation worsened in the both the EU and the euro area. Households’ expected savings also deteriorated in both areas. By contrast, households’ unemployment expectations improved, while expectations concerning the households’ financial situation remained unchanged. The results at the country level were also rather mixed. Spain, France and the UK reported an increase in consumer confidence. In Germany and Italy consumer confidence fell slightly, while it remained stable in Poland. © Copyright 2007 by Finfacts.com |
