ECONOMIC RECOVERY in the euro zone failed to gain momentum in May for the second month in a row, according to a “real-time” indicator designed to pre-empt official data.
The Eurocoin index, produced by the London-based Centre for Economic Policy Research and the Bank of Italy, declined from 0.6per cent to 0.55 per cent in May, having also dropped in April. The figures reflect quarter-on-quarter growth estimates for gross domestic product.
Eurocoin is based on a collection of surveys, including industrial production, demand indicators and stock-market indices.
It is designed to provide an early picture of growth trends, with the most erratic influences such as short-run volatility stripped out.
In a statement, the authors blamed “the yield curve and the share indices” for putting a brake on the indicator, which had been sustained on the positive side by industrial production.
While the May Eurocoin figures signal a weakening in the pace of growth in the euro zone, they point to a muted continuation of the upturn, from a low at the start of 2009.
The index has been positive since last autumn, reaching a peak of 0.79 per cent in March. The April figure was 0.67 per cent.
The most recent official growth figures for the euro-zone, produced by Eurostat, showed that GDP grew by 0.2 per cent in the first three months of this year, when compared with the final quarter of 2009.
The annual growth figure at that stage was 0.5 per cent.
UNA McCAFFREY
