European Leading Indicators | Sentiment jumps amid increased spending plans

Written By:
Judith Fischer, Knight Frank
1 minute to read

Here we look at the European leading indicators in the world of economics.

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Key insights:

The Eurozone Sentix index marked its highest reading since June 2024

The Eurozone Sentix index, which measures investors' assessment of the current and future economic situation, rose by 9.8 points in March. The expectations index surged by 17 points to its highest level since July 2021, likely reflecting improved investor confidence and stronger growth prospects driven by announced defense spending plans. Meanwhile, European stocks have continued to outperform their US counterparts.

The gap between Fed and ECB policy rates is widening

The Fed kept its policy rate steady at 4.25–4.50% in March, reflecting a heightened US inflation outlook and elevated uncertainty, while the ECB lowered its deposit rate to 2.50%. The widening gap enhances the relative appeal of European real estate for inbound capital.

Capital value growth in Europe is in positive territory across all sectors

European all-property capital value growth was positive for the second consecutive quarter in December 2024, according to MSCI. Capital values across all sectors have either stabilised or shown growth, with industrial leading the way at 1.2%.

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