Euro area consumer confidence hit by Brexit uncertainty in July

Consumer confidence in the euro area dropped back sharply in July, according to a widely-followed gauge of sentiment, with some analysts linking the drop to the immediate impact of the referendum vote in Britain.

The European Commission's index of consumer confidence fell from a reading of -7.2 in June to -7.9 for July, following a 15-month low of -9.7% plumbed in March 2016, after the heightened volatility seen in global capital markets at the start of the year.

"While there are no details available, there can be little doubt that a second successive drop in Eurozone consumer confidence to a three-month low in July is largely the consequence of heightened concerns over the economic and political outlook following the UK’s vote to leave the European Union. The June consumer confidence survey - which showed modest slippage - had been completed before the UK vote on 23 June .

"There may be an element of relief that July’s drop in Eurozone consumer confidence was not greater and it may alleviate some of the deepest concerns about how much Eurozone growth will be negatively impacted by the Brexit vote," said Dr. Howard Archer, chief UK+European economist at IHS Global Insight.