* Euro zone consumers versus business: bit.ly/2mCiW7K
By Jeremy Gaunt
LONDON Feb 27 Monday's release of euro zone
business and consumer sentiment roughly mirrored what was seen
earlier this month in Germany: businesses are relatively
bullish, consumers no so much.
As the following graphs - bit.ly/2mCiW7K - show,
business-conditions sentiment in the 19-member euro zone
rose in February to its highest level since
The same could be said for Germany's ZEW index of economic
conditions. Despite dipping slightly month on
month, it was just off highs not seen for nearly 6 years.
But consumers have another view. The euro zone final
consumer confidence index took a dive in February,
as did the GfK German consumer confidence index
looking ahead at March.
If this disconnect were to continue, it would quickly
undermine what appears to have been a robust start to the euro
zone economy's year.
The cause is probably inflation and wages. Rabobank's head
of macro strategy, Elwin de Groot, says the business environment
is bubbling along as the U.S. and Chinese economies grow.
But euro zone consumers are looking at rising inflation,
which they are not used to, and stagnant wages. Consumer price
inflation for the euro zone is expected to have hit 2 percent
when its is reported on Thursday.
Perhaps even more dampening to sentiment, however, is wage
In the fourth quarter of last year, the European Central
Bank's indicator of negotiated wage rates was at its lowest
since the euro was created - and extrapolated back beyond that
(Editing by Louise Ireland)