European business confidence improved in September but consumer morale is tottering from high energy costs, data show today.
Euro zone inflation leapt to 2.5 per cent in September, even further above the ECB's 2.0 per cent ceiling and German retail sales notched up their third successive monthly drop in August.
The International Monetary Fund added a warning that euro zone economic recovery was likely to be weak and that expensive oil had already cut growth by about one percentage point in the zone over the last two years.
"We see a recovery, a weak one, not a robust one," Michael Deppler, the head of the IMF's European department, told reporters today.
The European Commission said economic sentiment in the euro zone had improved for the fourth month in a row in September despite soaring oil prices but consumer confidence remained unchanged at -15 for the fifth month running.
The economic indicator, which reflects general economic activity from business and consumer surveys in the 12 countries using the euro currency, rose to 98.6 points in September from 97.8 in August, better than expectations of a fall to 97.3.
Analysts said the weakness of consumer confidence remained one of the main reasons behind the euro zone's sluggish economic growth rates.