In the days leading up to the Trump administration’s announcement on tariffs in early April, a poll conducted by the European Central Bank (ECB) captured an upswing in the eurozone’s business landscape, chiefly driven by an improving industrial sector.
The survey, published on Tuesday and involving 79 top non-financial firms, indicated positive sentiment among firms, highlighting burgeoning demand for machinery and equipment along with early signs of a more robust construction sector.
Meanwhile, despite such optimism, the business landscape appears to have deteriorated since the period between March 26 and April 2, when companies were surveyed prior to the financial turbulence sparked by U.S. tariff announcements.
The ECB last week cautioned that risks to economic growth had intensified considerably, with the trade conflict poised to dampen economic expansion.
Nevertheless, in the weeks leading up to the market upheaval, companies noted a slight uptick in employment prospects, although the primary focus remained on enhancing efficiency rather than expanding their workforce.
By the end of March, firms maintained a cautious approach towards tariffs, adopting a wait-and-see strategy without re-evaluating major investment decisions, according to the ECB.
