Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Euro-Area Confidence Improves Despite Spreading Virus Epidemic

Economic IndicatorsFeb 27, 2020 19:20
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Euro-Area Confidence Improves Despite Spreading Virus Epidemic

(Bloomberg) --

Euro-area economic confidence unexpectedly increased this month, indicating the bloc was gaining momentum before Italy took a blow from the spread of the coronavirus.

The European Commission’s sentiment index rose for a fourth month in February, with improvements in industry, services and consumer optimism. While the results, along other reports, suggest a mild pickup after the economy’s weak end to 2019, they may not fully reflect the current state of affairs.

The virus outbreak that began in China is increasingly casting a pall over economic activity. With factories closed, air transport halted, and consumers confined to their homes, companies including Royal Philips NV and Danone have grown more downbeat on their outlook.

On Thursday, Credit Suisse (SIX:CSGN) cut its forecast for global economic growth this year to 2.2% from 2.6%. It sees the euro zone expanding just 0.5%.

In Italy, the bloc’s third-largest economy, several towns in the wealthy, industrialized north are under quarantine due to the disease outbreak, and public events have been canceled.

What Bloomberg’s Economists Say

“Most analysts are assuming that the virus will be contained in 1Q. Taking the official numbers on falling new cases at face value that sounds plausible for China, though far from guaranteed. With outbreaks in Korea, Iran, Italy, and elsewhere, the global picture is even less certain.”

--Tom Orlik. Read the GLOBAL INSIGHT

The Commission survey was conducted Feb. 3-20. It showed a second monthly gain in industry confidence, with a gauge for existing orders improving by the most in 2 1/2 years. Service providers expected demand to remain stable, while households’ economic expectations jumped.

Sentiment saw marked improvements in the Netherlands, France and Spain, as well as a small uptick in Germany.

Much will depend on how the spread of the coronavirus will impact confidence in the weeks ahead. The epidemic has already triggered calls for more stimulative action by the European Central Bank, though with interest rates already negative and asset purchases underway, it’s not clear how much more firepower it has left.

Officials including France’s Francois Villeroy de Galhau and Italy’s Ignazio Visco have called on governments to take the lead in rebooting economies if there’s a deeper impact on growth.

The ECB, which is in the midst of a review of how it conducts business, will update its projections for growth and inflation when the Governing Council gathers in two weeks.

Euro-Area Confidence Improves Despite Spreading Virus Epidemic
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email