With the price of oil and the euro continuing to climb and financial markets continuing to be unsettled, it is not surprising that economic sentiment among Europeans continues to weaken. For the 27 countries in the European Union, the Economic Sentiment Indicator (ESI) fell 0.4% from 107.5 in November to 107.1 in December and was 4.7% below December, 2006. For the 13 countries in the Euro Area, the ESI fell only 0.1% in December to 104.7 from 104.8 in November (actually less than the consensus estimate) and was 4.6% below December 2006.

Although there are measures of economic sentiment for the EU 27 and the EA13, it is not possible to derive measures for the non EA as whole. However since sentiment in the EU 27 has generally been higher than that in the EA13, (as can be seen in the first chart) it can be inferred that sentiment in, at least, some of the non EA countries has been higher than those in the EA. The second chart showing selected countries in the EA--France, Germany and Italy--and the third chart, selected countries in the non EA--Sweden, United Kingdom, Poland and Latvia illustrate the point.