EC measure of consumer confidence fell from -3.7 in March to -4.6 in April, well above the levels seen even towards the end of last year. April's decline in the EC measure of consumer confidence suggests that concerns about Greece may have begun to take a toll on the euro-zone's household sector.
And on the basis of past form, consumer confidence is consistent with household spending growth picking up from 1.4% y/y in Q4 last year to around 2.0% y/y. This would be its fastest pace since mid-2007.
Given the continued strength of the activity surveys and April's improvement in the German ZEW measure of euro-zone economic conditions, it would not be surprising to see a further rise in the EC measure.
"We suspect that consumer confidence is unlikely to begin rising strongly again. The index measures consumers' optimism about their own financial and employment prospects, as well as the wider economic outlook, over the next twelve months. While low inflation should support households' real incomes, unemployment is likely to remain high. And we think that the boost to economic growth from the weaker euro will fade next year. All the while, the risk of a "Grexit" is mounting." notes Capital Economics
