- economists including Philip Shaw at Investec
Consumers and businesses in the 17-nation region that use the Euro in circulation were less pessimistic about their prospects this month, indicating a start of recovery from the longest recession ever. The European Commission said Thursday that a gauge of executive and consumer sentiment jumped to 91.4 from 89.5 in the preceding month, outpacing analysts' forecasts of a 90.4 reading. The sentiment in almost all sectors improved, with the measure of business climate reaching -0.68, up from -0.75, while indexes consumer confidence and industrial confidence rose to -18.8 and 11.2 respectively, both either meeting or beating projections. However, and index of services sentiment deteriorated further, falling to -9.5 in June, from -9.2 a month earlier.
Even though recent data suggest the overall improvement, another release showed that bank lending to businesses and households across the Eurozone continued to fall in May, underlying the necessity of structural reforms by governments to help money to transfer into a real economy. Earlier this week the ECB President Mario Draghi said that the policy will remain ultra-loose for as long as needed. The struggling Eurozone economy has been held back by strict austerity measures, weak consumer and business confidence and weak performance of exporting companies, all weighing on economic growth.
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