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Euro zone investor morale slumps, recession “becoming visible”
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BERLIN (Reuters) – Investor morale in the euro zone fell in May to its lowest level since June 2020, a survey showed on Monday, dropping for the third month in a row as the impact of the war in Ukraine on Europe’s largest economy becomes increasingly clear.
Sentix’s index for the euro zone fell to -22.6 in May from -18.0 in April. A Reuters poll had pointed to a May reading of -20.8.
“The global economy is facing a ‘perfect storm’,” Sentix Managing Director Manfred Huebner said in a statement.
“The traces of the Ukraine conflict are also becoming increasingly visible in the economy,” he said, adding of the euro area: “The recession is becoming visible.”
A current conditions index fell to -10.5 in May from -5.5 in April, declining for the third month in a row to its lowest level since March 2021.
An expectations index fell to -34.0 in May from -29.8 in April, also declining for the third month in a row and hitting its lowest level since December 2008.
(Writing by Paul Carrel, Editing by Rachel More)
Investor morale refers to the overall sentiment or confidence of investors regarding the economic outlook, which can influence their investment decisions and market behavior.
A recession is a significant decline in economic activity across the economy, lasting more than a few months, typically visible in real GDP, income, employment, manufacturing, and retail sales.
The euro zone is a group of European Union countries that have adopted the euro (€) as their official currency, facilitating easier trade and economic stability among member nations.
The Sentix index is a measure of investor sentiment in the euro zone, gauging the confidence of investors based on their expectations for future economic conditions.
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