Eurozone confidence slumps in April
(BRUSSELS) - Confidence in the 17-state eurozone fell sharply in April, data showed on Monday, adding pressure to the European Central Bank to make moves to boost the economy when it meets later this week.
The combined reading of business and consumer confidence, released by the European Commission, fell 1.5 points from March to 88.6 points because of an especially souring mood in the services sector.
European Union-wide, the index fell even more strongly, down 1.8 points to 89.7 points, the data showed.
"April's (commission) consumer and business survey supports other evidence that the eurozone is experiencing its longest recession on record," said Jennifer McKeown of Capital Economics
The "bad news ... might encourage the ECB to announce more policy support at its meeting this week," she said.
In the eurozone, confidence in the manufacturing sector fell 1.5 points while services slumped a sharp 4.1 points as the mood darkened regarding future demand and activity.
Consumer confidence however rose by 1.3 points as attitudes towards unemployment came in more positively, the data showed.
By country, confidence fell most steeply in the union's biggest economies with Germany losing 2.3 points and France 2.0 points.
Measures of confidence rose meanwhile in the Netherlands by 0.2 points and by 0.9 points in Spain.
"The latest confidence setback was not entirely caused by problems in the periphery," said Christian Schulz of Berenberg Bank.
"The fact core countries such as Germany and France took a hit suggests that wobbles in global demand because of the soft patch in China and the fiscal cliff in the US also hurt the rebound," he said.
The ECB's rate-setting governing council meets on Thursday with analysts expecting the bank to cut its key interest rate to kick-start bank lending to businesses and boost a sluggish economy.