According to the report from the European Commission, in May consumer confidence in the euro zone declined moderately, confirming economists' forecasts, while the economic sentiment index was higher than expected. The сonsumer confidence index fell to -23.6 points compared to -21.1 points in April. Meanwhile, the economic sentiment indicator fell to 104.0 from 105.0 in April. Consensus estimates suggested a drop to 103.0. The employment expectations indicator also decreased - by 1.7 points, to 110.9. As for the EU countries, the economic sentiment indicator fell to 102.5 from 104.2 last month, and the employment expectations indicator fell to 110.6 from 112.2.
The European Commission reported that the decline in the economic sentiment indicator in the EU was due to weaker confidence among construction managers, consumers, and to a lesser extent, retail trade managers. Industry confidence remained broadly stable (-0.2), while production expectations fell to 19-months low. Services confidence edged down (-0.4), while managers’ assessment of expected demand deteriorated to a 14-months low. Meanwhile, the further drop in consumer confidence resulted from marked determinations in all four components. Retail trade confidence declined slightly (-0.8), while construction confidence also dropped (-2.1), due to the largest fall in employment expectations since May 2020. Financial services confidence dropped further in June (-2.1) due to a worsening of all three components.
Meanwhile, the indicator of economic uncertainty rose 1.3 points in June to 23.9 points, driven by a substantial increase among consumers, which pushed consumer uncertainty to its highest level on record.