Euro area flash consumer sentiment indicator falls in June

The increased political uncertainty and associated market volatility is likely to be a drag on euro area economic sentiment in the near term, noted Daiwa Capital Market Research in a report.

Having stayed relatively elevated in the recent months even as business sentiment worsened, today’s flash euro area consumer sentiment indicator dropped in June by the most since January to the lowest level since October.

However, the index at -0.5, continues to be well above the long-run average and implies continued stable growth in consumption in the euro area as a whole.

“We will have to wait for the final estimate and national breakdown, to be published next Thursday, to see from where the deterioration in consumer confidence emanated. But there seems good reason to believe that it will have been concentrated in countries (e.g. Italy, Spain and/or Germany) where politics remain turbulent”, stated Daiwa Capital Market Research.

At 19:00 GMT the FxWirePro's Hourly Strength Index of Euro was neutral at 23.0174, while the FxWirePro's Hourly Strength Index of US Dollar was slightly bearish at -66.2938. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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