EU consumer confidence plunged during the GFC and again in 2011/12 during the European debt crisis. Since early 2014, it has been at average or above-average levels, rising to a cyclical peak at the beginning of 2018. Even after it dropped back significantly in late 2018, the index remained at a level which corresponds to significant optimism among households. After a substantial drop in March, the latest reading indicates March’s fall has accelerated in April.
The April survey conducted by the European Commission indicated household confidence collapsed to a level commensurate with readings during the 2011/12 debt crisis. The latest published reading of its Consumer Confidence index recorded a figure of -22.7, below the -17.5 which had been expected and considerably lower than March’s final figure of -11.6. The average reading since the beginning of 1985 has been -11.6.
The report came out on the same day as Brent crude pushed back above USD$20 per barrel and confidence of a new EU spending package built. By the end of the day, yields on German 10 year bunds had gained 7bps to -0.41% while French 10-year OATs had increased by 5bps to 0.12%.