Euro zone economic sentiment deteriorates in August

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BRUSSELS, Aug 30 (Reuters) – Euro zone economic sentiment was weaker than expected in August, continuing a steady decline since the start of the year and inflation expectations among consumers rose, reversing a four-month falling trend, survey data showed on Wednesday.

The European Commission’s monthly economic sentiment survey showed the index falling to 93.3 in August from 93.5 in July, defying market expectations of a minor uptick to 93.7.

Optimism in industry deteriorated to -10.3 from -9.3 in July, more than the -9.9 expected by economists and sentiment in services, the euro zone’s biggest contributor to its gross domestic product, fell to 3.9 from 5.4 in July, more than the 4.2 expected by markets.

The Commission said consumer inflation expectations 12 months ahead jumped to 9.0 from 4.9 in July, a break from a falling trend seen since April. Inflation expectations among manufacturers also rose for the first time since March to 3.6 from 3.4 in July.

EURO ZONEJune 2023July 2023August 2023
Economic sentiment95.2 (95.3)94.593.3
Industry-7.3-9.3 (-9.4)-10.3
Services5.7 (5.9)5.4 (5.7)3.9
Retail trade-5.9-4.5-5.0
Construction-2.6 (-2.4)-3.6 (-3.1)-5.2
Producer price expectations4.4 (4.3)3.43.6
Consumer price expectations6.1 (6.0)4.9 (4.8)9.0

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