Financial News: Eurozone Economic Confidence Weakest Since 2020

Eurozone Economic Confidence Weakest Since 2020

(RTTNews) - Euro area economic confidence deteriorated to the lowest level since November 2020, underscoring the rising concern about the strength of economic activity amid the intensifying price pressures and supply chain disruptions.

The economic sentiment index dropped more-than-expected to 93.0 in April from 96.2 in the prior month, results of a monthly survey by the European Commission showed on Wednesday.

The reading was worse than the expected level of 95.2 and also marked the lowest score since November 2020.

The decline of the ESI was largely driven by the deteriorating confidence among managers in services and retail trade, and also among consumers.

The industrial confidence index sunk to a four-month low of -7.7 from -7.0 in March.

At 0.9, the services sentiment index plummeted to the lowest since April 2021, from 4.1 in the previous month. The score was also below the forecast of 3.5.

The consumer sentiment index fell notably to -20.6, in line with the flash estimate, from -16.4 in March.

Sentiment among retail trade declined in April, with the index falling to -9.9 from -7.6 in the prior month. Similarly, confidence among building contractors weakened as the index dropped to -2.4 from -2.1 in March.

The employment expectations indicator plummeted 4.6 points to 91.7 in April. Selling price expectations increased across all business sectors, especially in industry, retail trade and construction. Inflation expectations have surged well above their long-term average, giving the European Central Bank's hawks ammunition to plead for an interest rate hike, ING economist Peter Vanden Houte said.

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