Euro-Area Consumer Confidence Rises More Than EstimatedCorina Ruhe
Euro-area consumer confidence increased more than economists estimated in August, as the economy of the 17-nation currency bloc gathers strength after a record-long recession.
An index of household confidence in the euro zone improved for a ninth month to minus 15.6, the highest level since July 2011, from minus 17.4 in the previous month, the European Commission in Brussels said in a preliminary report today. Economists had forecast an increase to minus 16.5, according to the median of 26 estimates in a Bloomberg News survey.
Gross domestic product in the euro region rose 0.3 percent in the three months through June after six quarterly contractions. Adding to the indications of recovery, services and manufacturing output expanded more than economists forecast in August, according to a report yesterday from London-based Markit Economics.
The euro erased losses against the dollar after the data were released, rising by as much as 0.2 percent, and was trading at $1.3368 at 4:04 p.m. in Brussels, up 0.1 percent on the day.
Dick Boer, chief executive officer of Zaandam, Netherlands-based Royal Ahold NV, said yesterday that the company “continued to perform well, both in Europe and the United States.” Ahold, which owns U.S. grocery chain Stop & Shop, posted second-quarter earnings that beat estimates.
Yet in “the current economic environment,” which includes record unemployment in the euro area, “we remain cautious in our outlook for the balance of the year, as we expect customers to be focused on value and volumes to remain under pressure,” Boer said.
While the euro zone’s second-quarter economic expansion was led by the region’s two biggest economies, Germany and France, at least four euro countries remain in recessions, including Italy and Spain. Retail sales fell 0.5 percent in June from a month earlier.
Heineken NV, the world’s third-biggest brewer, said this week that poor spring weather in Europe led to weak second-quarter revenue and predicted that earnings this year won’t grow as consumers in the region curb spending.
“For the remainder of the year, economic uncertainty and ongoing weak consumer sentiment is expected to persist across many key markets,” Heineken said in a statement.