Euro zone economic sentiment slips

Economic sentiment in the euro zone fell in June, but by less than expected.

The latest European Commission business surveys showed weakening confidence particularly in industry. There were gains in services and construction while in the retail sector and among consumers sentiment hardly changed.

The pessimism in the 17 countries using the euro comes as the region’s economy slowed after a strong start to the year.

The fall in manufacturing confidence was linked to a decline in export orders, which have been making up for weak domestic demand.

Jennifer McKeown, Senior European Economist with Capital Economics said: “June’s European Commission business and consumer survey is a further blow to hopes that strong growth in the region’s core might help to ease the crisis in the periphery.”

She added: “Worryingly, though, there is growing evidence that the slowdown is spreading to the region’s core countries — the German and French economic sentiment indicators both fell to their lowest levels since last autumn

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