A note from our Chief Economist
This is the European companion to the inaugural issue of Economic Currents, Board’s new quarterly perspective for retail, CPG, and manufacturing leaders.
If there’s one message I want you to take from this report, it’s that “resilient” and “confident” are not the same thing, and Europe this quarter is a good illustration of why that distinction matters for planning. Our State of the Consumer Index sits just below its longrun average, a modest softening driven almost entirely by geopolitical tension and renewed energy-price concern. The labor market, however, has not cracked. Firms are managing uncertainty through hiring caution rather than layoffs, unemployment remains close to historic lows, and real wages are still positive. That combination is what’s kept European consumers spending even as confidence has lagged behind the hard data.
The other theme I’d flag is dispersion across the bloc — not just across income groups, as in the U.S., but across countries. Southern Europe, Spain and Italy in particular, is carrying more momentum than the core. Germany and France are more cautious, still working through manufacturing softness and fiscal-policy uncertainty, respectively. Treating the eurozone consumer as one market will increasingly understate how differently the outlook is unfolding by country.
Boyd, Lucas, Matthew, and Maria take you through the detail below. I’ll close with what I think it means for your commercial planning across the region.
Michelle Green - Chief Economist
View the complete PDF to read the issue in its entirety.
