Business confidence fell in the Eurozone in August according to the European
In August the Economic Sentiment Indicator (ESI) fell in the Eurozone (by 1.5
points to 100.6) and the EU (by 1.2 points at 104.6).
Eurozone developments: After a broadly flat development over the last five
months, August's decrease shifted the Eurozone headline indicator back to its
December 2013 level. Worsened sentiment resulted from deterioration in retail
trade, consumer, industry, and, to a lesser extent, services confidence.
Construction confidence remained broadly unchanged. Amongst the largest
Eurozone economies, sentiment dropped significantly in Italy (-4.1), sending the
ESI below its long-term average of 100, and in Germany (-1.9). Milder
contractions were booked also in France (-0.6) and the Netherlands (-0.8), while
sentiment remained flat in Spain.
EU developments: The relatively more moderate decrease of the headline indicator
in the two largest non-Eurozone EU economies, the UK (-1.1) and Poland (-1.0),
resulted in a less severe contraction for the EU ESI (-1.2) compared to the
Eurozone. EU construction confidence improved, while, as in the Eurozone,
industry, retail trade, services and consumer confidence slipped. Financial
services confidence booked a more robust improvement (+1.9).
Business Climate Indicator broadly flat in August
In August 2014 the Business Climate Indicator (BCI) for the Eurozone remained
broadly flat (at +0.16) compared to July (+0.17). Managers' more optimistic
appraisals of past production and, to a lesser extent, export order books were
offset by a marked decrease in their assessment of expected
production. Managers' views on the level of stocks of finished products and
overall order books remained broadly unchanged.