Euro zone sentiment rebounds more than expected, but unemployment up

(C) Reuters.

BRUSSELS (Reuters) – Euro zone economic sentiment rebounded more than expected in July as governments relaxed restrictions related to the COVID-19 pandemic, with the sharpest gains in industry and services even though consumers became more gloomy, data showed on Thursday.

The European Commission said economic sentiment rose to 82.3 points in July from an upwardly revised 75.8 in June, beating market expectations of an increase to 81.0.

Sentiment in industry jumped to -16.2 from -21.6 in June and in services to -26.1 from -35.5. But among consumers, the mood deteriorated to -15.0 in July from -14.7 last month.

Selling price expectations in industry, which slumped dramatically at the start of the pandemic in March, April and May, also rose sharply in July to -1.0 from -4.4 in June.

At the same time, inflation expectations among consumers for the next 12 months fell to 17.5 in July from 21.6 in June.

Separately, the European Union’s statistics office said euro zone unemployment rose to 7.8% of the workforce in June, up from an upwardly revised 7.7% in May as 203,000 people lost jobs bringing the total unemployed to 12.685 million people.