FXStreet (Guatemala) – Bert Colijn, analyst at ING Bank noted that the consumer confidence in the Eurozone plummeted in July amid uncertainty surrounding the Greek crisis.
Key Quotes:
“The decline in the flash estimate from -5.6 to -7.1 shows that concerns about the Greek crisis are significantly impacting the consumers’ view on the economy, even though contagion effects on the rest of the Eurozone are currently much smaller than in previous episodes of the crisis. It has to be said that the strong consumer response could relate to the period in which the survey was conducted, which largely fell before the agreement between Greece and its creditors of Monday July 13.”
“The weakening of confidence in the past months shows that strong consumption growth in the Eurozone of the past quarters could moderate somewhat as consumers have become more cautious in past months. The trend is likely to remain relatively positive though, as the weak inflationary environment and slowly but surely improving labour market conditions will likely continue to fuel consumption growth in the second half of the year.”
“This is supported by the fact that consumer confidence is still well above its long-term average. Confidence in their own financial situation among consumers remained very strong over the past months (July data for sub-indices not out yet), which bodes well for the months ahead, despite the continued hardship in one of the member states.”
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