European Consumer Confidence

Households’ assessment of their financial situation over the past 12 months remained relatively unchanged and negative (–14.5 in July, up from –17.3 a month ago).  

Expectations for households’ financial situation over the next 12 months improved, up from –38 in June to –30.7 in July.   

Expectations for the general economic situation over the next 12 months showed the greatest gain but remained the most negative component at–43.5, an improvement from –53.8 the previous month.   

Intentions to make major purchases over the next 12 months continued to strengthen, climbing back to an almost neutral –2.7 points in July, steadily rising from –4.3 points in June and –9.2 points in May. 

A continuous improvement in inflation expectations for the past three months, with all Euro Area countries continuing to report easing inflation concerns (the Euro Area average rose by 32 points from –85 in June to –32 in July). While most countries remain clearly in negative territory, this steady improvement reflects an easing of the shock consumers felt following the onset of the Iran war-induced energy crisis. 

A slow return to normality. Questions assessing current consumption, as well as present-day economic and financial conditions, were less affected by the war in Iran, falling by much less and recovering faster than their forward-looking counterparts (Both the present situation and expectations indices started at around +30 points in February, but by March the latter had fallen to –50, while the former had fallen to only –15). As the energy shock slowly eases and pessimistic expectations subside, most Euro Area countries are reporting confidence numbers closer to their long-term averages. Of the 21 countries tracked, Austria is the only one still displaying clear pessimism (-102.2 points). 

Steadily rising savings intention. Even as expectations continue to normalize and present-day conditions improve, Euro Area households continue to report increasing savings intentions (up 34 points from 205 in June to 239 in July)—raising questions about whether increased savings will result in future spending or simply reflect a rise in precautionary behavior. 

Unemployment expectations for the next 12 months also improved in July, with the Euro Area average up 17 points from June. However, country-level data reveal a notable divergence among the Euro Area’s largest economies, with concerns about unemployment easing significantly in Italy and France and more moderately in Spain, while in Germany they rose to their highest level in almost five years. 

Germany: Consumer confidence rose by 10 points to –65: 

• The change reflected a steady improvement in all four main questions, with spending intentions seeing the highest increase from the previous month (five points). 

France: Consumer confidence rose by 19 points to –85.7: 

• As with Germany, the improvement was driven by increased optimism across nearly all main questions, with spending intentions being the only exception, which sharply deteriorated by 17 points from June to July and fell back into negative territory. 

Italy: Consumer confidence rose by 24 points to –95: 

• Large improvements in economic and financial expectations (about 10 points each) brought confidence close to March levels. However, a continued steady deterioration in current financial conditions is still weighing on Italian consumers, which could point to more structural issues. 

Spain: Consumer confidence improved, falling by six points to –24: 

• Small gains in spending intentions (four points) and economic expectations (two points) brought confidence closer to neutral levels. Spain remains the best-performing major Euro Area country, though present and expected financial conditions have remained nearly frozen at last month's level.  

Q1: Financial situation over the past 12 months  

Q2: Expected financial situation over the next 12 months  

Q4: Expected general economic situation over the next 12 months  

Q9: Major purchase intentions over the next 12 months