Eurozone leading index signals further GDP contraction in second half
2012-08-27 13:42:40
A leading indicator of Eurozone's economic activity remained unchanged in July, following three months of consecutive declines, a report from the Conference Board showed Monday.
The leading economic index for the euro area was unchanged in July at 104.8. This followed decreases of 0.2 percent in June and 0.3 percent in May.
In July, greater business pessimism in both manufacturing and services was offset by moderate improvements in financial indicators, said Jean-Claude Manini, the Conference Board's senior economist for Europe.
"It is questionable, however, whether financial indicators can continue to offset greater weakness in the non-financial sector," the economist said.
"The leading indicators suggest that, following the moderate drop in Euro Area GDP during the second quarter, a further contraction in economic activity during the second half of the year is likely," Manini said.
The coincident economic index, which measures current economic activity, was steady at 101.9 in July. The index decreased 0.1 percent in June and increased 0.2 percent in May.