Mixed Performance among Indicators Clouds Prospects for Euro Area Recovery
- The Conference Board Leading Economic Index® (LEI) for the Euro Area rose only marginally in February, and its rate of increase slowed considerably compared to January, suggesting that the timing of a recovery for the region remains unclear
- Previous improvements in business confidence, especially in manufacturing, have stalled, showing that the economy has probably not started growing yet
- LEIs for France, United Kingdom, and Spain increased in January, and all have positive six-month growth rates, while Germany’s is slightly negative
- Handling of the Cypriot bank bailout illustrates continued uncertainties about financial stability
- Weak domestic consumption is one major factor holding back Euro Area recovery
- High youth unemployment and shifting demographics may impede recovery in consumption over the long term in Euro Area economies
