ING retail sales and weak consumer confidence figures out yesterday show the Eurozone heading for stagnation or further decline, economists warned.
Euro area sales revenues fell for the fifth consecutive month in March, according to Markit’s retail purchasing managers’ index (PMI), although with a score of 49.1 the fall was much slower than in January, when the PMI came in at a three-year low of 42.9. Any score below 50 represents a contraction.
The European Commission’s index of economic sentiment for the Eurozone fell to 94.4 in March from 94.5 in February, well below its long-term average of 100. “Given that consumer spending accounts for some 63 per cent of GDP on the expenditure side, this threatens to limit overall growth prospects,” said IHS Global Insight’s Howard Archer.
However, Germany remained relatively strong as unemployment fell to a 20-year low of 7.2 per cent in March.