BRUSSELS – Morale in the eurozone rose for the second straight month in November as a pick-up in industry sentiment just outweighed increased pessimism among consumers, offering a tentative sign that the bloc is avoiding outright stagnation.
The European Commission said on Thursday that economic sentiment in the 18 countries sharing the euro rose to 100.8 this month from 100.7 in October and 99.9 in September. Economists polled by Reuters had expected a decline to 100.3.
The optimism was mirrored by a rise in the business climate indicator for the eurozone, which the Commission said stood at 0.18 in November, up from a revised 0.06 in October.
Following a crisis that nearly broke up the bloc, the eurozone is suffering from very low inflation and a recovery so fragile that it is dragging on global growth, while unemployment remains near record levels.
That was clear in the Commission’s data, which showed consumer confidence falling to a nine month low in November, although it typically lags in a recovery.
The Commission expects the eurozone economy, which generates almost a fifth of global output, to avoid a recession this year, but it will not reach stronger growth until 2016, a year later than the EU executive had previously predicted.
Industry showed the way in November, improving for the second month in a row. Retail trade fared well, while services were flat. Construction was down.
“The positive development in industry confidence was fueled by an important improvement of managers’ assessment of overall order books,” the Commission said in its statement. [Reuters]