Hopes for a swift global recovery suffered a jolt yesterday as freezing winter weather contributed to a sudden drop in spending and confidence across several advanced economies.
Although policymakers predicted a bumpy rebound in global economic health, the raft of negative data in the US and Europe confounded analysts' predictions and halted gains in equity markets.
At the close of trading in London, the S&P 500 index had fallen by almost 1 per cent to 1,097, the FTSE 100 index was off 0.7 per cent at 5,315 and the Eurofirst 300 index was down 1.3 per cent at 1,010.
Markets were most unnerved by an unexpected fall in US consumer confidence. According to the Conference Board, the global business group, Americans had turned more pessimistic about both present and future economic conditions.
Its index of confidence fell from 56.5 in January to 46 this month, its lowest level since April 2009.
Brian Bethune, chief US financial economist at Global Insight, said that the severe weather had undermined consumer sentiment. “Consumer spending is not expected to energise the recovery in 2010, but rather plod along at relatively subdued rates. Today's report simply reinforces that view,” he said.
Global Insight美国首席金融经济学家布莱恩•贝休恩(Brian Bethune)表示，恶劣天气削弱了消费者情绪。“预计今年消费开支无法为经济复苏提供动力，而只能保持相当缓慢的脚步。今日的报告只是加强了这种观点。”
Data yesterday showed that German business confidence had fallen for the first time in a year, while French consumers had cut back on spending.
Mervyn King, governor of the Bank of England, said the eurozone “appears to have stalled”.