Euro zone confidence falls for fifth straight month
New research shows that investor sentiment is now at his lowest in over three years
By CFOWorld staff | CFO UK | Published 11:22, 06 August 12
Euro zone confidence fell for the fifth consecutive month in August, hitting its lowest level in over three years as concerns about the ongoing debt crisis flared up again, the latest research showed on Monday.
A monthly index from the Sentix research group, which tracks investor sentiment, showed on Monday that confidence the 17-nation currency bloc dipped to -30.3 in August, down from -29.6 in July.
Comments from European Central Bank president Mario Draghi on Thursday indicating that the ECB could begin buying government bonds again to reduce surging borrowing costs in Spain and Italy appeared to have helped limit the damage.
The expectations component of the index improved slightly for the first time in many months, rising to -23.3 from -24.0 in July.
"The main reason for this was probably ECB president Draghi's unusually energetic defence of the euro," Sentix said in its report.
"The survey results suggest that this reassured investors, especially institutionals, that more decisive steps will follow (also from politicians) to save the common currency."
Still, a sub-index on the current situation continued to fall in August, dipping to -37.0 from -35.0 the previous month. This took the overall index to its lowest level since July 2009.
A separate index for Germany dipped to 1.3 from 2.2, despite a slight improvement in the expectations component. An index for the US also fell, while one for Asia, excluding Japan, edged higher.
photo credit: Reuters
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