The Eurozone’s Economic Sentiment Indicator (ESI) dropped to 95.2 in March 2025, marking a three-month low from 96.3 in February and falling short of the projected 97.
Euro area economic sentiment unexpectedly worsens
The decline was primarily driven by weaker confidence in services (2.4 vs. 5.1), retail trade (-6.8 vs. -5.1), and consumer sentiment (-14.5 vs. -13.6). Meanwhile, confidence in industry (-10.6 vs. -11) and construction (-3.4 vs. -3.3) remained relatively stable. Among the largest EU economies, the ESI saw notable declines in France (-2.1 to 96.4) and Italy (-2.0 to 97.6), while Spain experienced an improvement (+1.1 to 103.4). Confidence in Germany rose slightly (+0.3 to 89.4), while it remained unchanged in the Netherlands (100.3).
Consumer confidence declines
In the Euro Area, the consumer confidence indicator declined by 0.9 points to -14.5 in March 2025, reaching its lowest level in three months, in line with preliminary estimates. Across the broader European Union, consumer sentiment dropped by 1 point to -13.9, reflecting growing pessimism regarding the future general economic outlook and, to a lesser extent, their household’s past and expected financial situation. However, there was a slight uptick in consumers’ intentions to make major purchases within the next 12 months.
