Wednesday, official data revealed that Eurozone retail sales fell at its fastest pace on record in March as the worst global recession since the Second World War left millions unemployed, hurting the purchasing power.

In UK, house prices continued to fall in April, but at a slower pace, survey data revealed. Meanwhile, consumer confidence rose at the fastest pace in almost two years in April as global equity markets showed strong recovery and the country's housing market displayed some tentative signs of improvement, a separate survey showed. Elsewhere, a think tank predicted that the UK economy is set to contract the most since 1931.


Data released by the Eurostat showed that Eurozone retail sales fell a record 4.2% year-on-year in March. Economists had expected a 2.6% fall after a 4% decline in February. On a monthly basis, sales were down 0.6% after a revised 0.3% contraction in February.

The purchasing managers' index for the Eurozone service sector rose to 43.8 in April from 40.9 recorded in March and from a flash reading of 43.1, reports said citing data released by the Markit Economics. Economists had expected the index to match the flash estimate. A PMI reading below 50 suggests contraction in the sector. The composite index, which include the manufacturing PMI and the service sector PMI stood at 41.1, up from 40.5 initially estimated and the previous month's 43.1.

Spain's National Institute of Statistics announced that the industrial production declined a calendar adjusted 24.7% year-over-year in March, after falling 22.5% in February. Economists were looking a decline of 19.7%.

Statistics Austria announced that the wholesale price index or WPI rose 8.6% year-over-year in April, after falling 8.6% in March.

The Statistical Office of the Slovak Republic said in a report that the retail sales at constant prices dropped 7.5% year-over-year in March

Rest of Europe

A report from Lloyds Banking Group Plc's Halifax division showed that UK house prices declined 1.7% in April, following a 1.9% fall in the previous month. Economists had expected a drop of 1% in house prices.

The Nationwide Building Society said the consumer confidence index rose eight points to 50 in April marking the largest single monthly rise for nearly two years. Economists had expected a slight increase to 43 from March's reading of 42.

Further, the National Institute of Economic and Social Research said the British economy would shrink 4.3% in 2009, the worst contraction since 1931. However, the economy is expected to grow 0.9% in 2010 given the export recovery. The growth is expected to accelerate to 2.3% in 2011.

The British Retail Consortium reported that its shop price index declined 0.5% in April from March. The index increased 0.4% in March. The retail body said total shop prices for the year to April increased 1.4%, following an on-year increase of 2% in March.

The Swiss National Bank Governing Board member Thomas Jordan said in a speech in Zurich that the initial impact of the unconventional measures has been positive.

The State Statistics Committee of Ukraine announced that the consumer price index or CPI rose 15.6% year-over-year in April, slower than the 18.1% increase in the previous month.

Statistics Iceland said in a preliminary report that the trade surplus stood at ISK 2.3 billion in April, down from ISK 8.3 billion surplus in March.

Industrial production in Denmark declined a seasonally adjusted 2.4% month-on-month in March, registering the steepest fall in a decade, the Statistics Denmark said. In February, industrial production was down 2.7%.

Norway's central bank reduced its key policy rate by 50 basis points to 1.5%, with effect from May 7. In March, the bank had lowered its key interest rate to 2% from 2.5%.

Romania's central bank also cut its key interest rate by 50 basis points to 9.5%. Economists had expected the central bank to reduce the rate to 9.75%. In March, the bank had kept its key interest rate unchanged at 10%.

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