Germany enjoyed a strong surge in confidence in the first quarter, gaining 6.4 points to 62.7, its highest level since January 2011.
Germany enjoyed a strong surge in confidence in the first quarter, gaining 6.4 points to 62.7, its highest level since January 2011.

EU Business Leaders’ Confidence Holds Firm

EU Business Leaders’ Confidence Holds Firm

YPO, the premier chief executive leadership organization in the world, announced Tuesday that confidence among chief executives in the European Union remained stable in the first quarter of 2017, despite significant fluctuations within the major EU
economies. The results of the YPO Global Pulse Confidence Index for the EU remained positive at 60.9, maintaining its highest level since April 2016. While overall sentiment remained steady, there were significant shifts in confidence within the
major EU economies. France saw a sharp decline in confidence in the weeks preceding the tightlycontested presidential election on April 23. The Index for France slumped 8.1 points to 54.5, its lowest level since January 2015, GlobalNewsWire reported. 

Greece also reported a severe loss of confidence, following its weak economic performance, crashing 11.9 points to 46.2, its lowest point since July 2015 and back in pessimistic territory. Italy saw a more moderate decline, slipping 1.5 points to 59.8. Germany, on the other hand, enjoyed a strong surge in confidence in the first quarter, gaining 6.4 points to 62.7, its highest level since January 2011.

This followed stronger than anticipated growth at the end of 2016 and in the first three
months of this year. The United Kingdom also reported a more positive outlook, jumping 6.0 points to 61.0, its highest level in the past twelve months, and prior to the referendum decision to leave the EU.


Global Confidence

Non-EU Europe reported the lowest level of confidence in the world, falling 2.5 points to 51.8. Globally, the YPO Global Pulse Index for the first quarter of 2017 edged up 0.3 point to 62.5, its highest level since January 2015. For the second consecutive quarter, the United States reported the highest level of confidence in the world, inching up 0.3 point to 64.9.

Confidence in Asia climbed 2.1 points to land at 63.3, its highest level since April 2015.

Africa is the second-least confident region globally, edging down 0.3 point to 54.4. Elsewhere, confidence in Latin America dropped by 1.2 points to 57.1, while confidence in the Middle East and North Africa region showed the biggest decline, sliding 4.3 points to 55.2.

Optimism Prevails

EU business leaders remained optimistic about the prospects for revenue growth within their own organizations over the next 12 months. The YPO Sales Confidence Index edged up 0.4 point to 66.9, as nearly two-thirds of CEOs (64%) predicted increased revenue in 2017, compared with only 5% who predicted a decline in sales.

However, business leaders were less optimistic when it came to their hiring intentions.

The majority (70%) expected the size of their workforce to remain unchanged over the next 12 months, while 26% expected to increase headcount, and 4% expected to cut staff numbers.

The majority (57%) of CEOs also expected fixed investment levels to remain flat over the next year, while 38% expected to increase fixed investment, and 5% predicted a decline.

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