In December 2011, the Economic Sentiment declined and the Business Climate improved
The Economic Sentiment Indicator (ESI) declined moderately in December in both, the EU and the euro area. The overall decline in the EU resulted from weakening confidence in services, construction and among consumers, while sentiment improved in retail trade and remained broadly stable in industry. On the other hand, the Business Climate Indicator (BCI) for the euro area increased for the first time in ten months.
The Commission released its statistics for the Economic Sentiment Indicator (ESI) and the Business Climate Indicator (BCI) in December 2011. While the BCI improved in both, the EU and the euro area, the ESI declined moderately. The Economic Sentiment Indicator (ESI) declined by 0.8 points in the EU and by 0.5 points in the euro area, to 92.0 and 93.3, respectively. In September 2011, for instance, both indicators declined strongly.
According to the Commission, among the largest Member States, Poland (-5.0) reported the biggest decrease in sentiment, followed by Italy (-4.6), Spain (-1.3) and, to a lesser extent, the UK (-0.5). Sentiment was broadly unchanged in France (+0.1), while it improved in the Netherlands (+0.8) and Germany (+1.0). With regard to the causes, the overall decline in the EU resulted from weakening confidence in services, construction and among consumers, while sentiment improved in retail trade and remained broadly stable in industry. In the euro area, a worsening of sentiment was observed in services, retail trade and among consumers, while confidence in industry and construction was broadly unchanged.
In December 2011, the Business Climate Indicator (BCI) for the euro area increased for the first time in ten months. The improvement in the BCI in December was mainly driven by increased optimism about production expectations, as well as by a more positive assessment of production trends observed in recent months and export order books. By contrast, managers were more pessimistic about their overall order books, and their assessments of stocks of finished products marginally increased.