Economic sentiment in Europe improved in July 2025, with the Economic Sentiment Indicator (ESI) rising by 1.0 points to 95.3 in the EU and by 1.6 points to 95.8 in the euro area, according to a survey released on Wednesday by the European Commission. Despite the uptick, both indicators remain below their long-term average of 100. The improvement was driven by stronger confidence in industry, services, retail trade, and a modest increase in consumer confidence. Construction sentiment, however, weakened, reflecting a decline in employment expectations. The Employment Expectations Indicator (EEI) remained broadly stable in both regions, staying below average. While job prospects in retail and construction weakened, services showed improvement. Industry expectations were unchanged. Capacity utilisation in the services sector increased to 90.2 per cent in the EU, above its long-term average, while industry utilisation was nearly flat at 77.9 per cent. Price expectations rose across all sectors, particularly in services, and consumers' inflation expectations for the next 12 months increased sharply. The Economic Uncertainty Indicator rose by 1.0 point to 17.3, with higher uncertainty reported by managers in industry and services. Attribution: Amwal Al Ghad English Subediting: M. S. Salama
