While it decreased by 0.6 points to 105.5 in the euro area the Economic Sentiment Indicator (ESI) was broadly unchanged at 105.4 in the EU. The overall decline in the euro area resulted from weakening confidence in all the business sectors, while sentiment improved among consumers.

In comparison with the data collected in April, confidence among consumers increased in both the EU and the euro area, reflecting more optimism about the future general economic situation and decreasing unemployment fears. Consumers were also more confident about their households' expected financial situation, especially in the EU.

However, confidence in industry decreased by 1.7 points in both the EU and the euro area, on the back of a drop in firms' production expectations and a worsening assessment of the level of order books. Managers were also more pessimistic about their export order books and past production, which declined substantially, while their appraisal of stocks continued to recover from historic lows. Moreover, confidence in financial services decreased in both the EU and in the euro area, mainly because of a weaker assessment of past and expected demand evolution.

In the EU, employment expectations deteriorated in industry and improved in services, which can mainly be ascribed to the UK. In the euro area, employment expectations weakened both in industry and in services. Managers’ selling-price expectations declined in these two sectors, as well as consumers’ price expectations.