Eurozone economic sentiment rebounds for first time in two years

BRUSSELS, April 29 (Xinhua) -- Eurozone economic sentiment picked up from a record low in April, for the first time since May2007, a survey conducted by the European Commission showed on Wednesday.

The economic sentiment indicator in the 16-nation bloc sharing the euro increased by 2.5 points to 67.2 in April, after having kept falling in the past two years and reached a record low of 64.7 last month.

In the 27-nation European Union (EU), the monthly indicator, based on business and consumer surveys, also rose by 3.5 points in April to 63.9.

The surveys are conducted in different sectors of the economy, namely industry, services, construction and retail trade, as well as among consumers.

The rebound in April resulted from a clear improvement in sentiment in industry and among consumers, which in both the euro zone and the EU rose by the same amount of 3 points, and a smaller increase in services, a rise of 1 point in both regions.

Retail trade sentiment grew by 2 points in the EU, but fell by 2 points in the euro zone. Construction, in contrast, declined in both areas, by 1 point in the EU and by 2 points in the euro zone.

The majority of EU member states registered an improvement in April. Among the largest ones, economic sentiment in Italy rose the most, up 6.4 points, followed by Britain and the Netherlands, up 5.1 and 4.2 points respectively, while the rise was less sizable in France and Germany, up 1.0 and 0.8 points respectively.

The financial services confidence indicator, which is not included in the economic sentiment, improved markedly in both areas, by 11 points in the EU and by 16 points in the euro zone.

Compared to March, managers' assessment of business situation and demand for their services augmented significantly. Managers' expectations of demand improved strongly and became positive for the fist time since October 2008.

Meanwhile, the business climate indicator (BCI) for the euro zone also increased in April, the first improvement since May 2008,the commission said in a separate survey.

The rise in the BCI reflected an improving situation in most of its underlying components. Managers' production expectations picked up clearly in April, while the production trend observed in recent months improved only slightly. Their assessment of current overall order books and stocks of finished goods recovered marginally from last month's level, though export order books continued to worsen.

However, the commission said the indicator remained at a very low level, pointing to another negative outcome for year-on-year industrial production growth in March, after the record fall registered in February.

"Given the current levels, it also suggests that annual industrial production growth will remain clearly subdued in April," it said.