Economic Sentiment Softens Modestly in June

EUROZONE JUNE ECONOMIC SENTIMENT 104; MAY 105

• Economic sentiment dipped one point in June to 104, coming in slightly stronger than the two-point weakening expected. This is the lowest reading since March 2021, however, remains above levels seen for the majority of 2020.
• Economic sentiment in the EU saw a larger 1.7-point decrease to 102.5.
• The Netherlands saw the steepest decline (-3.6 points), followed by Germany and Spain (both -1.9 points).
• Confidence weakened across construction, consumer, retail and services sentiment. Industry remained largely stable, largely due to current orders remaining robust despite production expectations slumping to a 19-month low.
• Expected services demand dipped to a 14-month low, on the back of an anticipated drop-off in consumer demand, as households saw their future financial positions at a record low.
• The employment indicator also saw a notable -1.6-point decrease, on the back of deteriorating employment expectations in the upcoming months.
• On the inflation front, selling prices continued to climb to a fresh high in retail, whilst seeing some relief in industry and construction.