EU, euro area economic sentiment rises slightly to 95.5 in September

Among the bloc’s largest economies, sentiment diverged: Spain (+3.0) and Italy (+0.7) saw notable improvements, while the Netherlands (-0.7) and Germany (-0.4) recorded declines. Sentiment edged up slightly in France (+0.3) and Poland (+0.1), as per Joint Harmonised EU Programme of Business and Consumer Surveys data.

Sectoral trends showed industry confidence improving by 0.3 points, supported by higher manager’s production expectations, despite weaker order book assessments. Consumer confidence also gained modestly (+0.5). Retail trade sentiment dropped by one point due to stock and past business concerns, although short-term business expectations brightened somewhat.

In contrast, the Employment Expectations Indicator (EEI) declined across both regions, falling by 0.9 points in the EU (to 97.1) and 1.3 points in the euro area (to 96.4). The dip reflected weaker hiring plans in retail, though industry hiring expectations improved marginally. Consumers’ unemployment fears worsened slightly.

The price outlook also signalled mixed trends. Managers’ selling price expectations decreased in industry and remained broadly stable in retail trade. In industry, selling price expectations slipped slightly below the long-term average, while they stayed above average in the other three sectors. Consumers’ price expectations for the next twelve months decreased, but their perceptions of price developments over the past year remained stable. Both, however, are still elevated.

Meanwhile, the Economic Uncertainty Indicator (EUI) edged up by 0.5 points to 17.2. Managers’ uncertainty about future business conditions rose in retail but eased in industry. Consumers, however, expressed greater unease about their future financial situation in September.

ALCHEMPro News Desk (SG)