Brexit con­tin­ues to shake up Eu­ro­zone busi­ness con­fi­dence

The Myanmar Times - - International Business -

BRI­TAIN’S vote to quit the Euro­pean Union con­tin­ued to un­der­mine eu­ro­zone busi­ness and con­sumer con­fi­dence in Au­gust, an­a­lysts said af­ter worse-than-ex­pected of­fi­cial fig­ures.

The Eco­nomic Sen­ti­ment In­di­ca­tor for the 19-na­tion eu­ro­zone com­piled by the Euro­pean Com­mis­sion fell one full point to 103.5 in Au­gust.

For the full 28-mem­ber Euro­pean Union, the ESI was down 0.9 points from July at 103.8, hold­ing above the boom-bust line of 100 points.

An­a­lysts said the re­port was dis­ap­point­ing and be­low fore­casts as un­cer­tain­ties about Brexit con­tin­ued to dampen sen­ti­ment.

Howard Archer at IHS Markit said the “marked dip in over­all busi­ness and con­sumer con­fi­dence fu­els con­cerns that the down­side risks to eu­ro­zone growth out­look have been ag­gra­vated by the UK’s Brexit vote”.

For his part, Jack Allen of Cap­i­tal Eco­nomics said in “the de­cline in the ESI ... left the in­dex be­low the con­sen­sus fore­cast and at its low­est level in six months”.

Mr Allen said the re­port “showed a broad-based de­cline in sen­ti­ment”, with growth set to slow to just 0.1 or 0.2 per­cent in the three months to Septem­ber com­pared with a gain of 0.3pc in the sec­ond quar­ter.

On this show­ing, the Euro­pean Cen­tral Bank will have to take ad­di­tional eco­nomic stim­u­lus mea­sures at its next meet­ing on Septem­ber 8, he added. –

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