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European Commission

Press release

Brussels, 28 May 2014

May 2014: Economic Sentiment rises in the euro area, remains broadly stable in the EU

In May the Economic Sentiment Indicator (ESI) rose in the euro area (by 0.7 points to 102.7), following its almost tantamount decrease in April. In the EU, the headline indicator remained broadly stable (+0.2 points at 106.5).

Economic sentiment indicator (s.a.)

April EU: 106.5 - Euro Area: 102.7

Euro area developments

In the euro area, improved sentiment was driven by higher confidence among consumers as well as industry and construction managers. Confidence in services and retail trade remained (broadly) unchanged compared to April. Amongst the five largest euro area economies, the ESI increased in Spain (+0.4), Italy (+0.5), Germany (+0.7) and, particularly, the Netherlands (+1.3). Only France saw sentiment slightly declining (-0.4).

The moderate increase in industry confidence (+0.5) was backed by managers' more optimistic production expectations and a brighter appraisal of the current level of overall order books. The assessment of stocks of finished products remained virtually unchanged. Of the questions not included in the confidence indicator, the level of past production and, to a lesser extent, the current level of export order books were viewed more positively. The broadly flat development in services confidence (+0.3) resulted from managers' more positive appraisal of the past business situation and past demand being partially offset by lower demand expectations. Consumer confidence brightened (+1.5) thanks to consumers' more optimistic assessment of all components of the confidence indicator (future unemployment, expectations on savings, future general economic situation, expected financial situation). The flat development in retail trade confidence (±0.0) was the result of a strong increase in managers' appraisal of the present business situation that was fully absorbed by a more negative assessment of both the volume of stocks and the expected business situation. The slight improvement in construction confidence (+0.4) was backed by managers' more optimistic views on employment expectations, while their assessment of the level of order books worsened. Financial services confidence (not included in the ESI) saw another steep increase (+6.2). Important improvements were registered in all three components of the confidence indicator (past business situation, past demand and demand expectations).

Employment plans increased in construction and industry, while deteriorating in retail trade and, particularly, services. Selling price expectations were revised upwards in construction and services, while declining in retail trade. No significant changes were envisaged in industry. After three decreases in a row, price expectations of consumers rose.

EU developments

The headline indicator for the EU remained broadly stable (+0.2), reflecting slipping sentiment in the largest non-euro area EU economy (UK, -1.0). Sentiment in Poland was flat (±0.0). In line with the euro area results, confidence in the EU improved among consumers and in financial services. By contrast, while EU confidence increased in retail trade, developments in the other business sectors were worse than in the euro area.

Consumers' views on future unemployment as well as managers' employment plans in construction and services for the euro area were paralleled on the EU-level. Contrasting with the euro area, EU managers in industry revised their employment expectations downwards, while EU employment plans in retail trade were assed more positively.

As for price expectations, EU results were similar to the developments in the euro area, except for a downward revision of selling price expectations in services.

Industrial confidence indicator (s.a.)

April EU: -1.8 - Euro Area: -3.0

Service confidence indicator (s.a.)

April EU: 8.2 - Euro Area: 3.8

Consumer confidence indicator (s.a.)

April EU: -4.1 - Euro Area: -7.1

Retail trade confidence indicator (s.a.)

April EU: 4.1 - Euro Area: -2.5

Construction confidence indicator (s.a.)

April EU: -25.6 - Euro Area: -30.0

Financial services confidence indicator (n.s.a.)

April EU: 21.9 - Euro Area: 17.1

The next Business and Consumer Survey is due to be published on 27 June 2014.

Full tables are available on:

Scheduled publication dates

Flash estimate

Final release EU, euro area and Member States

June 2014

20 June 2014

27 June 2014

July 2014

23 July 2014

30 July 2014

August 2014

21 August 2014

28 August 2014

Contacts :

Simon O'Connor (+32 2 296 73 59)

Vandna Kalia (+32 2 299 58 24)

Audrey Augier (+32 2 297 16 07)

For the public: Europe Direct by phone 00 800 6 7 8 9 10 11 or by e­mail

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