Economic confidence in the euro area climbed to 93.5 in May, exceeding expectations, as services sector optimism offset industrial weakness.
Euro area economic sentiment improved to 93.5 in May, up from a revised 93.2 in April and above the 92.8 forecast. The uptick was driven by a rebound in services confidence, which rose to 2.2 after a sharp decline in April, while industrial confidence fell further to -8.0.
Despite the modest gain, sentiment remains below its long-term average of 100, weighed down by persistent headwinds from the Middle East conflict, higher prices, and supply chain disruptions. Retail trade and construction confidence also deteriorated, while employment expectations edged up slightly to 2.1, supported by hiring plans in services and retail.
Selling price expectations eased to 27.4 from 30.2 but remain elevated, signaling ongoing inflation risks that could pressure the economic outlook.