Euro-Area Economic Sentiment Sees Worst Losing Streak in Decade
(Bloomberg) -- Euro-area economic confidence slid for a 12th month in December, marking the worst streak since the depths of the financial crisis as trade headwinds and the risk of a German recession cast a cloud over the region’s outlook.
The European Commission’s economic sentiment index -- which covers the mood among both households and companies -- dropped more than analysts predicted, to its lowest level in almost two years. The decline was broad-based across industry groups and countries.
Economic momentum in the 19-nation euro area weakened persistently through 2018. U.S.-led protectionist policies damped exports, and the risk of a hard Brexit and political uncertainty in some countries including Italy weighed on activity. The outlook received a further damper on Tuesday after a slump in German industrial production suggested Europe’s largest economy may have fallen into a technical recession.
The news come after the European Central Bank decided last month that it will no longer add stimulus after nearly four years of buying bonds across the region, urging governments to step up reforms to boost growth.
The Commission said sentiment weakened in all of the five largest euro-area economies, with Spain recording the largest drop. Managers were more pessimistic on euro-area production expectations and order books in the industry, future demand in services and employment prospects in construction.
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