New EU Data to Add Economic IndicatorThe European Union (EU) is expected to release a set of new data on Friday to give a first official sight of the euro zone's services sector, according to EU sources.The new data is to be published for the first time along with monthly business and consumer survey of the European Commission, the executive branch of the 15-nation EU. The data aims to fill a hole in policy makers' knowledge of future trends in gross domestic product (GDP) by covering a sector which accounts for around half the total euro zone output compared with manufacturing's share of about 25 percent. The survey, based on a monthly questionnaire of 50,000 firms and 20,000 consumers, is currently geared only towards the expectations of manufacturers, retailers and individuals. A headline economic sentiment index is calculated from components covering sentiment of industry, construction, consumers and stock markets. The headline index is estimated by the commission to lead trends in euro zone GDP by one or two months. EU officials hope that the addition of services to the mix will prevent policy mistakes. European Central Bank Chief Economist Otmar Issing told the European Parliament last week that it was difficult to be clear about the real health situation of the U.S. economy because most data currently available covered manufacturing, whose share of the economy is shrinking. The same arguments apply in Europe, officials say. Like other euro zone data, however, the new survey will come with a health warning. The commission believes that it would be at least a year before the services survey could be incorporated into the overall sentiment index, and that in the meantime results should be treated with caution. |
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