Euro area LEI signals headwinds; GDP growth seen unchanged

The Conference Board (TCB) Leading Economic Index (LEI) for the euro area declined 0.3 per cent in July 2025 to 99.1 (2016=100), following a 0.5 per cent fall in June. Over the January–July period, the LEI contracted 2.4 per cent, easing from a 3.1 per cent drop in the prior six months.

“The euro area LEI declined further in July. Non-financial components continued to weigh on the Index, especially consumer expectations which worsened. In addition, orders and business expectations in the manufacturing sector remained depressed, as did expectations in the service sector. Meanwhile, financial components continued to strengthen, mitigating some of the overall Index’s decline. The 6-month growth rate of the LEI improved for the third consecutive month but remained negative and still signalled headwinds ahead,” said Stephanie Guichard, senior economist, at The Conference Board.

Meanwhile, the Coincident Economic Index (CEI) remained flat at 109.7 (2016=100) for the second straight month, with a 0.4 per cent gain over the first half of 2025, slightly slower than the 0.5 per cent rise in the preceding six months, TCB said in a release.

“GDP expansion slowed considerably in Q2 after a strong Q1, and The Conference Board currently expects GDP to grow by 0.9 per cent in 2025 (unchanged from 2024),” Guichard added.

ALCHEMPro News Desk (HU)