Eurozone economic sentiment worse than forecast

City A.M. Reporter
Eurozone economic sentiment fell more than expected in November, data showed, as business mangers turned more pessimistic across almost all sectors of the economy, particularly in France and the Netherlands.

The European Commission's monthly survey showed the sentiment index at 93.7 against 94.8 in October, falling to levels last seen in late 2009. Economists polled by Reuters had expected a reading of 94.0.

Sentiment deteriorated in industry, falling by 0.8 points in the 17-nation euro area from October, and among consumers, where it declined by 0.5 points.

"Euro-area managers expect to decrease their investment volumes by 2 per cent in 2012 compared with 2011," the commission said in a statement.

The mood was bad in the services sector, with the index falling 1.8 points, while in retail, sentiment dropped 1.3 points. Only in construction was there some optimism in November, and sentiment nudged up 0.3 points, the Commission said.

However, in the financial services sector confidence increase, rising 4.9 per cent on the month, which the Commission attributed to "managers' improved assessment of recent developments in business situation and demand."

The Commission's separate business climate indicator fell for the ninth month in a row in November, falling to -0.44 points from -0.19 points and notching up a third month in negative territory. November's reading is the lowest in more than 18 months, since February 2010.