Eurozone economic sentiment steady in November

The European Commission’s headline economic sentiment index edged up to 106.5 in November from a revised 106.4 in October, missing economists’ expectations for a reading of 107.0.

The EC said the virtually unchanged sentiment resulted from a mild deterioration in industry confidence and stable readings in services, which offset more upbeat assessments of construction and retail trade managers, as well as consumers.

Among the largest eurozone economies, the economic sentiment indicator rose in France and Spain, was broadly steady in the Netherlands and eased in Germany and Italy.

Meanwhile, the headline index for the European Union nudged up 0.4 points to 107.3 due to improved sentiment in the UK, which brought the national ESI back to its level before the Brexit vote.

The business climate indicator for the eurozone fell to 0.42 from 0.56, missing expectations for a nudge up to 0.57.

The European Commission said managers' assessments of the past production deteriorated significantly, as did their views on overall/export order books and the stocks of finished products.

By contrast, their production expectations remained virtually unchanged.

Capital Economics said the rise in the economic sentiment indicator – which was below consensus but in line with its estimate – supports the message from the PMI that euro-zone growth accelerated towards the end of the year.

Pantheon Macroeconomics said: “Overall, this survey supports the message from other survey data that Q4 will be a solid one for the eurozone economy.”