ECB: Eurozone Construction Activity Likely To Remain Subdued

FRANKFURT (MNI) – Eurozone construction activity is likely to
remain subdued, the European Central Bank said in its latest Monthly
Bulletin, citing recent short-term indicators.

The ECB noted “diverging developments” across the larger Eurozone
member states, with construction activity falling in France, Italy,
Spain and the Netherlands, while remaining stable in Germany.

“The mood in the euro area construction industry as a whole
reflects a subdued sentiment in the five largest euro area countries,
except Germany, where it is more positive,” the ECB said.

The central bank warned that fiscal measures in France and Italy,
including property tax hikes and the phasing-out of measures favouring
residential property investments, could hinder construction activity
moving forward.

“In addition, activity in those countries more affected by the
sovereign debt crisis may be dampened by higher financing costs and
adjustments in the financial sector, while in Germany activity will be
supported by low financing costs,” the ECB said.

— Frankfurt bureau: +49 69 720 142; email: frankfurt@marketnews.com —

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