Eurozone: Worsening of Greek crisis shows early signs of impact in Eurozone economic sentiment
June 29, 2015
After a strong start to the year, economic sentiment in the Eurozone took a mild hit from the Greek debt crisis, where the economic and political situation worsened in recent weeks. The Economic Sentiment Index (ESI), which is published by the European Commission, fell from 103.8 in May to 103.5 in June and also came in below the 103.8 the markets had expected. Nonetheless, the ESI continues to hover above the 100-point long-term average.
The drop in sentiment was pronounced in the industrial and retailing sectors. It improved somewhat in the construction sector, while remained stable in services. In addition, consumer confidence was unchanged over the previous month.
At a country level, lower economic sentiment levels were observed in Malta (-3.5 points), Estonia (-1.5 points) and Greece (-0.6 points). Conversely, higher readings were observed in Portugal (+1.4 points), Austria (+0.8 points) and Cyprus (+0.7 points). Among the four largest Eurozone economies, sentiment in Germany was unchanged over the previous month while in France it fell (-0.2 points). Meanwhile, economic sentiment in Italy improved (+0.8 points), while in Spain it deteriorated notably (-2.0 points).
Author: Ricardo Aceves, Senior Economist