June 29, 2020 / 9:53 AM / 8 days ago

Recovery of euro zone economic sentiment gathers pace in June

FILE PHOTO: European Union flags fly outside the European Commission headquarters in Brussels, Belgium, December 19, 2019. REUTERS/Yves Herman/File Photo

BRUSSELS (Reuters) - The recovery of economic sentiment in the euro zone intensified in June after a modest pick-up in May, with improvements across all sectors and a much more buoyant sense of future business, European Commission data showed on Monday.

Overall sentiment rose to 75.7 points in June from 67.5 in May, still short of market expectations of 80.0 and well below the average of 100 since 2000.

The index crashed in April to its lowest level since measurements started in 1985 as lockdowns closed large sectors of the economy.

May’s pick-up was due to rises in sentiment in industry and among consumers. June’s further increase was across all sectors, the sharpest rebounds being for retail trade and services. The latter generates about two-thirds of euro zone GDP.

Expectations about production, future demand or plans to make purchases were key parts of the improvement. All sectors also viewed employment plans more favourably, the indicator recovering between 40 and 60% of the March and April losses.

The largest euro area economies - France, Germany, Italy, the Netherlands and Spain - also all registered increased confidence.

Selling price expectations picked up markedly in industry, services and retail. By contrast, consumer price expectations plummeted to an extent last seen in the financial crisis.

For European Commission data click on:

here

Brussels newsroom; Editing by Nick Macfie

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