2018.01.2606:39:00UTC+00Eurozone Consumer Confidence Record Could Be Breached A Few More Times In 2018

Eurozone consumer confidence is likely to touch further record highs over the course of 2018 on the backdrop of favorable general economic situation, Bert Colijn, an economist at ING, said.

The consumer confidence index jumped from 0.5 in December to 1.3 in January, which was the fourth highest reading on record, data from the European Commission showed on January 23.

"The outlook for domestic demand remains very favorable, confirming our expectations of continued strong GDP growth early in the year," the economist pointed out.

With inflation still low, job growth surprising on the upside, house prices increasing and growth forecasts adjusted upwards, there is a lot to like for consumers, Colijn added.

However, uncertainty about possible Eurozone reform, Italian elections and the success of the German coalition negotiations clearly take a backseat to improved economic factors.

"Over the past few months, consumer confidence improved most notably because of a much more positive view on the general economic situation, modest improvements in assessments of the financial situation and increased amounts of current and expected major purchases", ING said.

This indicates that optimism and stronger consumption are going hand in hand, spurring the household consumption component of GDP growth.

"With such a favorable outlook, it could well be that the record for consumer confidence could be breached a few more times in 2018," the economist concluded.