CEO Comité Européen de l‘Outillage 
European Tool Committee 
Europäisches Werkzeugkomittee

European Business Cycle Indicators – 4th Quarter 2020

This edition takes a closer look at the results of the autumn 2020 EU investment survey in the manufacturing sector.

Recent developments:

  • The Economic Sentiment Indicators (ESI) for the euro area (EA) and the EU moved broadly sideways over the fourth quarter, settling 0.5 points lower in December compared to September in both regions. At 94.4 (EA) and 89.5 (EU), the ESI is still well below its pre-pandemic level of February 2020 and its long-term average of 100.
  • The Employment Expectations Indicator (EEI) worsened somewhat more markedly over the fourth quarter of 2020. In December, the indicator was 3.3 points (EA) and 2.1 points (EU) lower than in September. At 88.3 in the EA and 89.5 in the EU, the EEI remains significantly below its long-term average of 100.
  • The slight decline in economic sentiment over the fourth quarter resulted from marked decreases in the services and retail trade sectors which more than offset substantial improvements in industry and, to a lesser extent, construction. Confidence among consumers remained broadly unchanged compared to September.
  • Consumers’ savings expectations rose further over the fourth quarter, hitting a historical high in December.
  • At country level, the ESI continued to recover in two of the six largest EU economies, the Netherlands (+1.3) and Spain (+1.1). By contrast, the indicator decreased markedly in France (−5.7) and, to a lesser extent, in Poland (−1.3) and Germany (−1.2). In Italy (−0.7), sentiment remained broadly stable.
  • Capacity utilisation in manufacturing recovered further (+4.2 percentage points in the EA, +4.1 in the EU). Still, at 76.3% (EA) and 76.5% (EU) in October, industrial capacity utilisation remained far below its long-term average of 80.6% (in both regions). Also capacity utilisation in services registered an increase (+0.7 percentage points in the EA and +0.5 in the EU). At 86.2% (EA) / 86.5% (EU), the rates remained below their respective long-term averages (as calculated from 2011 onwards) of 88.8% and 89.0%.


Further information:

European Business Cycle Indicators – 4th Quarter 2020

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