The Business Climate Indicator (BCI) for the euro area fell for the sixth consecutive month in August 2011, according to the latest data from the European Commission Directorate-General for Economic and Financial Affairs. The index stood at 0.07 in August, down from 0.44 in July 2011 and down from 0.67 in August 2010.
The index achieved an all-time high plateau in the first three months of 2011, reaching 1.45 in January, 1.46 in February, and 1.43 in March. Monthly decreases began in April 2011.
While the current level of the indicator remains positive, the EU said the steady fall since March suggests that euro-area industry has entered a phase of growth moderation.
The drop in the BCI reflects managers being more pessimistic about overall order books and export order books. These developments came with a worsening in both production expectations and in the assessment of production trends observed in recent months. Appraisal of stocks continued to increase from historic lows.
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