Business confidence improved in Q2, but slight setback for Capex plans 

The latest UBS Evidence Lab survey (> Access Dataset) of 540 Eurozone firms in Germany, France, Italy and Spain, conducted between 15 April and 6 May, provides new insight into the Eurozone firms' investment, employment and compensation plans in Q2. Overall business confidence improved, thanks above all to better sentiment in France and Italy. Business confidence in the consumer sector underperformed other sectors, presumably due to the delay in the lifting of mobility restrictions. Corporate capex plans suffered a setback in Q2, with the net balance of investment intentions falling to +6% in Q2 from +8% in Q1. Capex intentions weakened in Spain and Italy, but improved in France and Germany; investment plans weakened in consumer companies, but rose in industrials and materials. As before, capex intentions remain a lot weaker in SMEs than in large firms. Despite some improvement from Q1, corporate employment plans have remained weak in Q2 2021 across countries and sectors and particularly in SMEs. Corporate wage expectations have picked up a bit, but remain overall moderate.