Eurozone economic, business confidence rises despite Brexit

Economic and business confidence in the Eurozone during the month of July rose, despite woes concerning the June 23 vote for the United Kingdom to leave membership of the European Union.

A key gauge of economic sentiment in the 19-country bloc, compiled by the European Commission, recorded a small uptick in confidence to 104.6 this month from June’s reading of 104.4. Analysts had expected it to drop to 103.5 in the first full month after Brexit.

In contrast, households have reported a drop in their outlook over the currency bloc’s consumer-driven growth in the coming months, which has created worries in the region. However, the decline was offset by a rise in the sectors of industry, retail and construction.

According to the survey, eurozone’s business sentiment rose to 0.37, an increase of 0.19 points, beating a 0.17 forecast. Further, sentiments in the UK dropped to 102.6 to 107 in June, while Italy reported the best improvement in economic indicator of the eurozone’s five biggest economies, up 0.4 points. Spain’s confidence reading in July was down 0.5, while France witnessed a decline of 0.4.

Meanwhile, the data dropped in much later than most surveys indicated that the common currency zone is trying to shrug off the negative implications after the Brexit vote on June 23. Germany, Europe’s largest economy, saw private sector activity soar to its highest levels in July.