The ESI compiled by the European Commission reversed the improvement we saw in May for both the EU and the Euro-zone sub-set. The main driver of this was the industry sector, although confidence also fell in retail trade and, to a lesser extent, among consumers; the service sector was broadly stable while construction improved.
The European Commission draws from a range of surveys to construct confidence indicators for five sectors of the economy and then uses these to calculate up its Economic Sentiment Indicator (ESI) which is converted to an index based on the long-run average. You should note that although dated June 2025, the data collection period ran from 1st to 20th of that month, so the trends really refer to May, with the 3-month blocks covering March to May (past) and June to August (future).
Industry confidence is measured based on responses to three questions – managers’ production expectations over the coming 3 months, the current level of order books and stocks of finished products – and all of them deteriorated in this survey. There are a couple of other questions that are reported but are not included in the calculation; again, both output over the previous 3 months and export order books saw more pessimistic responses than in the May results.
Amongst the largest EU economies, the ESI only improved significantly in Poland (+1.0 points), but there was a slight increase (both +0.2) in Italy and the Netherlands. There was a substantial reduction in France (-3.4), with smaller declines registered in Spain (-1.4) and Germany (-0.8).
As noted above, the ESI is calculated against the long-run average, so we can look at the position of the individual countries against their own historical situation – this is the best way to compare between countries. Overall, only 9 Member States have an ESI at or above 100 in this survey – these were Bulgaria, Croatia, Cyprus, Greece, Lithuania, Malta (back in this list this time), Poland, Portugal and Spain; Czechia and Luxembourg fell back below their respective long-run averages. The EU candidate countries also participate in this survey, with Albania and Montenegro also above the threshold.
You can download the EC report and statistical annex from their website at https://economy-finance.ec.europa.eu/economic-forecast-and-surveys/business-and-consumer-surveys/download-business-and-consumer-survey-data/press-releases_en (open the 2025 box) or you can request it from MTA.