Economic mood in euro zone brightens again in May

Thursday, May 30th, 2013 | Finance News

BRUSSELS (Reuters) - Confidence in the euro zone's economy improved more than anticipated in May, data showed on Thursday, offering a glimmer of hope for a recovery later this year.

Economic morale in the 17 countries using the euro increased by 0.8 point to 89.4, the European Commission said. Economists polled by Reuters had expected an increase to 89.0.

Confidence improved in all five of the euro zone's largest economies - Germany, France, Italy, Spain and the Netherlands. The upturn was notable across all sectors except for construction.

The bloc's largest economy, Germany, expected to accelerate growth in the second quarter of this year, saw a 0.6 point rise in the economic mood, while recession-hit France registered a 0.9-point jump.

The European Central Bank (ECB) cut its key interest rate this month to a new record low and said the euro zone was more stable than a year ago, but stressed that challenging economic conditions remain and governments must push on with reforms.

ECB President Mario Draghi also said earlier this month the central bank was ready to cut interest rates again if the bloc's economy deteriorates further.

The increase in industrial confidence was driven by a much more positive assessment of the current level of order books, the Commission said.

The Commission's measure of the euro zone's business cycle picked up again in May, increasing more than expected by 0.28 points to -0.76, compared with economists' consensus for a -0.87 level.

(Reporting by Martin Santa)

Source