By Francisco Miñana
Date: Thursday 28 Jun 2012
The Eurozone's economic confidence indicator fell by 0.6 to 89.9 points in June compared to the previous month's revised reading of 90.5, according to data from the European Commission. The market was expecting a reading of 89.5.
Looking at index components, the decline was led by declines in industrial and service confidence. On the other hand, retail and construction confidence improved.
Industrial confidence: -12.7 versus previous 11.4.
Services confidence: -7.4 versus previous -5.2.
Consumer confidence: -19.8 versus previous -19.3.
Retail trade confidence: -14.8 versus previous -18.1.
Construction confidence: -28.1 versus previous -30.2.
Business climate: -0.94 versus previous -0.79.
In terms of Eurozone members, confidence worsened in France (-1.5 points), Germany (-1.4), and Poland (-1.3%) and to a lesser extent in Holland (-0.3%). On the other hand, confidence improved in the United Kingdom (1.9), Spain (1.0), and Italy (0.9). Economic sentiment remains above the long-term average only in Germany.
According to analysts at Digital Look, "this data is very negative as economic confidence marks a fourth consecutive negative month and a two-year low. Additionally, confidence fell the most in the two most important sectors, industry and services."
The data from the European Commission, along with the Purchase Manager Indices (PMIs) by Markit Economics, are leading macroeconomic indicators that attempt to predict changes to the economic cycle.
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