EU: December 107.1
Euro area: December 104.7
In both regions the decline in the ESI is reflected in the indicators for the industry, retail trade, and construction sectors. In addition, consumer confidence declined in the euro area, while it remained unchanged in the EU. In both areas, the confidence indicator for the services sector was the only one to improve.
A large majority of countries reported decreases in sentiment in December. Among the large Member States, confidence deteriorated in Germany (-0.3), Spain (-1.2), France (-0.9), Poland (-0.6) and the UK (-1.2). In Italy (+2.3) confidence improved.
Industrial confidence indicator (s.a.)
EU: December 2
Euro area: December 2
After a recovery in November, the industrial confidence indicator declined in December, decreasing by one point in both the EU and the euro area. The level of the indicator remains well above its long-term average.
In the EU, managers' production expectations and their assessment of order books deteriorated, contributing to the overall decline in industrial confidence. Their views on stocks of finished products improved slightly. In the euro area, essentially the same trends were observed, except for managers' production expectations, which remained unchanged.
Among the large EU Member States, industrial confidence increased only in Germany (+1), while it weakened in Spain (-2), France (-2), Italy (-1) and the UK (-3). It remained unchanged in Poland for a sixth consecutive month.
Service confidence indicator (s.a.)
EU: December 15
Euro area: December 14
Following the recent period of declining confidence, the services confidence indicator recovered slightly in both the EU and the euro area in December. The indicator still remains below its long-term average in both areas.
In the EU, the increase in the confidence indicator was due to managers’ improved appraisal of the recent evolution of demand, which increased by two points. Their assessments of the other two components of the confidence indicator, the current business situation and demand expectations, remained unchanged. In the euro area, both demand components improved, while managers’ assessment of the current business situation deteriorated slightly.
At the country level, a majority of countries reported decreasing sentiment in December, but for a large share of countries the indicator was stable. Among the large Member States, services confidence increased significantly in Italy (+9), although not enough to offset the loss registered in the previous month. Sentiment also improved in the UK (+1), while it decreased in Germany (-1) and France (-2). Confidence remained stable in Spain.
Consumer confidence indicator (s.a.)
EU: December -7
Euro area: December -9
In December, consumer confidence remained stable in the EU, while it continued to weaken in the euro area. Following a peak in May 2007, confidence in both areas has declined fairly steadily. Consumer confidence, however, is still above its long-term average, but for the euro area there is only a two-point difference.
In both areas, consumers' expectations regarding the general economic situation and their financial situation deteriorated, while their views on unemployment over the next 12 months remained unchanged. The main difference between the two areas concerned savings over the next 12 months, which was stable in the EU but declined somewhat in the euro area.
At the individual country level, the results are mixed, but almost half of the countries reported a decrease in confidence in December. Among the large Member States, consumer confidence decreased in Germany (-1), Spain (-2) and the UK (-1), while it increased by one point in France and Poland. In Italy consumer confidence remained unchanged.
Retail trade confidence indicator (s.a.)
EU: December 2
Euro area: December 1
In December, the retail confidence indicator decreased in both the EU and the euro area. The indicator remains above its long-term average in both areas.
In the EU, all the underlying components of the indicator contributed to the fall in confidence. While retailers' assessments of the present business situation and volume of stocks deteriorated in the euro area as well, the expected business situation remained stable.
At the country level, the results are predominantly negative. Among the large Member States, retail confidence decreased substantially in Germany (-5) and the UK (-4). A drop in confidence of one point was also recorded in Spain, Italy and Poland. Only in France (+4) did retail confidence increase.
Construction confidence indicator (s.a.)
EU: December -3
Euro area: December -5
The construction confidence indicator declined further in December in both the EU and the euro area. Nevertheless, the level of the indicator still remains far above its long-term average.
In both areas, the decline in the confidence indicator was the result of a worsening in the two underlying components. Managers' assessment of order books decreased by two points in the EU and by one point in the euro area. Their employment expectations dropped by three and four points respectively.
Developments at the individual country level were fairly mixed. Among the large Member States, construction confidence weakened in France (-2), Italy (-6) and the UK (-7), while it strengthened in Poland (+2). In Germany and Spain construction confidence was stable.
Financial services confidence indicator (n.s.a.)
EU: December 20
Euro area: December 18
Following the fall in September and October, the financial services confidence indicator continued to recover in the EU in December. For the euro area, however, another significant drop was registered. The indicator remains well below its long-term average in both areas.
In the EU, the increase in the indicator was the net result of an improvement in managers' assessment of both the past business situation and the past evolution of demand and their deteriorating views on the expected evolution of demand. In the euro area, the past business situation was considered better than in November, but this was counter-balanced by more negative views on the past evolution of demand. The pivotal factor was managers' expectations of future demand, which worsened substantially.
These results are derived from the EU survey in the financial services sector, launched by the European Commission to further increase the sectoral coverage of its survey programme. In line with the schedule of the other business surveys, the survey has been carried out on a monthly basis since April 2006. The objective is to achieve representative results for the EU and the euro area as a whole, rather than for individual Member States. To this end, only a subset of countries are surveyed, which gives rise to higher volatility than if all countries were included, especially in the case of the indicator for the smaller euro area.
