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Euro Area Consumer Confidence Continues to Improve in August, While Expectations of Higher Inflation Rose
Latest Press Release
The Conference Board Consumer Confidence Index® for the Euro Area rose 7.6 points to –78 in August, up from –86 in July, the highest level since the war in Iran started in February. The increase was driven by continuous improvement in current and future financial conditions (two- and five-point gains, respectively). However, confidence remains 45 points below February levels.
The Conference Board Consumer Confidence Index® for the Euro Area standardizes DG ECFIN consumer survey data since 1985 against the long-term average. A value of zero represents the long-term average. Readings above +100 indicate clear consumer optimism, while readings below –100 indicate clear consumer pessimism.
“Euro Area consumer confidence continued to marginallyimprove in August, with consistent increases across Euro Area countries,” said Matei Farcas, Economic Research Assistant at The Conference Board. “For most Euro Area countries, this improvement was broad-based if limited, reflecting improving views regarding the financial situation. However, spending intentions continue to be cautious and close to neutral, showing little further improvement. The current volatile, inflation-prone environment appears to have made Euro Area consumers considerably more prudent."
Euro Area Overview
The breakdown of the overall Euro Area index shows that in August:
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Households’ assessment of their financial situation over the past 12 months continued to slowly improve (–12.7in August, up from –14.5 a month ago).
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Expectations for households’ financial situation over the next 12 months improved, up from –30.7 in July to–25.6 in August.
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Expectations for the general economic situation over the next 12 months remained steady at -43.8 in August.
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Intentions to make major purchases over the next 12 months stood at the same level as the previous month, increasing by less than one percentage point, from 2.7 in July to 3.4 in August.
These trends were associated with:
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A strong and simultaneous deterioration in inflation expectations across Euro Area countries, with nearly all Euro Area countries reporting increased inflation concerns from July to August (the Euro Area average declined by 24 points from –53 in July to –77 in August). The only exception were Greece, Spain, and Italy, which continued a three-month trend of easing inflation concerns.
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Current consumption intentions remain muted and uneven across countries. On average, the largest countries reported worsening current consumption intentions, while the smallest showed slight improvements. Given the importance of these large countries in Euro Area private consumption, the overall index recorded an eight-point decline, from -143 in July to -151 in August.
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Savings intentions remain highly worrying. Euro Area countries continue to predominantly display extremely high intentions to save, as the small dip in April and May was reversed in the months since. In August, savings intentions were at 251 points, the second-highest level since October 2025 (256 points) in all 26 years of available data. A likely reflection of the constant uncertainty weighing on Euro Area households.
Country Highlights
Country-level confidence improved across the Euro Area in August compared to July. Among the largest economies:
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Germany: Consumer confidence rose by 17 points to –47:
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The change reflected a continued steady improvement in all four main questions, with financial expectations seeing the highest increase from the previous month (14 points).
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France: Consumer confidence declined by 10 points to –95:
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The deterioration was driven by small decreases in all questions, with the exception of spending intentions, which remained at the same level as July (at -10 points). The sharpest decrease was recorded in economic expectations, with a six-point decrease, from -38 in July to -44 in August.
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Italy: Consumer confidence deteriorated slightly by one point to -96:
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Declines in financial (-5 points) and economic expectations (-3 points) were nearly compensated by improvements in current financial conditions (3 points) and spending intentions (3 points). Since the Russian invasion of Ukraine, Italy has consistently displayed the most pessimism about financial and economic expectations out of all major Euro Area countries.
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Spain: Consumer confidence remained stable, falling by less than one point to -25:
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Unlike Italy, Spain showed improvements in financial (1 point) and economic expectations (2 points) but decreases in spending intentions (-4 points) and current financial conditions (-1 point).
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Among smaller Euro Area economies, Finland recorded the strongest gain in confidence in August—nearly reaching neutrality thanks to a 38-point improvement from the previous month—while Slovenia saw the largest monthly decrease, down 35 points to -7 points (from 28 in July). Croatia continues to show the greatest optimism at 100 points, closely followed by Malta (85 points) and Lithuania (73 points).
“Euro Area consumer confidence continued to improve in August, gradually recovering from the decline triggered in April amid the US-Iran war. However, GDP expenditure data suggest private consumption remains weak. Household spending left Q2 on a soft footing, while August survey data point to a rising preference for saving among European households. As a result, a meaningful acceleration in consumer spending over H2 looks unlikely, which should continue to constrain overall economic growth,” said Konstantinos Panitsas, Economist at The Conference Board.
Technical Note
The Conference Board’s Consumer Confidence Index® for the Euro Area is calculated using four questions from the European Commission’s consumer confidence survey:
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Q1: Financial situation over the past 12 months
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Q2: Expected financial situation over the next 12 months
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Q4: Expected general economic situation over the next 12 months
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Q9: Major purchase intentions over the next 12 months
Each component is standardized using historical distributions and equally weighted in constructing the overall index. Positive values indicate confidence above the long-term average, while negative values indicate below-average sentiment. Country-level survey results are weighted by each country’s share of Euro Area private consumption before aggregation into the composite Euro Area index.
The monthly Europe Consumer Confidence Survey® is based on data from the European Commission consumer survey program.
For further information: Contact Harry Miskin (hmiskin@tcb.org)
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