Eurozone economic confidence rose to a four-month high in May, driven by marked improvements in sentiment among consumers and managers in the retail trade and construction sectors.
The economic sentiment index improved more-than-expected to 104.7 from a revised score of 104.0 in the previous month, survey results from the European Commission showed Monday.
This was the highest score since January, when it stood at 105.0. The index was forecast to rise to 104.4 from April's originally estimated reading of 103.9.
The consumer confidence index rose to -7.0 from -9.3 a month ago. The score matched the flash estimate.
The sharp increase in consumer confidence was driven by markedly more positive assessments of the future general economic situation, future unemployment and savings expectations, the survey showed.
At the same time, the strong improvement in retail trade confidence to 3.2 from 1.3 resulted from markedly more positive views on the present business situation and the adequacy of the volume of stocks.
Meanwhile, the industrial sentiment indicator held steady at -3.6 in May, in line with expectations.
The unchanged industry confidence resulted from managers' more positive assessments of the current level of overall order books and stocks of finished products being offset by a marked decrease in their production expectations.
The confidence index for construction rose to -17.5 from -19.2 in April. The improvement was fueled by a strong upward revision in managers' assessment of the level of order books, while their employment expectations remained virtually unchanged.
Another report showed that the business confidence index rose to a four-month high of 0.26 in May from 0.15 in April.
Managers' appraisal of past production improved markedly and also the stocks of finished products and overall order books were assessed more positively.
By contrast, managers' production expectations worsened strongly and their views on export order books remained virtually unchanged.
May's further improvement in Eurozone business and consumer confidence and slightly encouraging price developments reinforce already strong belief that the European Central Bank will sit tight at its 2 June policy meeting and stress that it is in "wait and see" mode, IHS Global Insight Economist Howard Archer said.
by RTT Staff Writer
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