Euro zone confidence highest in January since July 2011

BRUSSELS (AFP) - Eurozone economic confidence increased in January to the highest level since July 2011, a key European Commission indicator showed on Thursday.

Confidence in the 18-nation area stood at 100.9 points against 100.4 in December, the EU executive said.

The EU's ESI indicator showed confidence notably on the rise in major economies Germany (0.7 points), where confidence was at its highest since August 2011, and in France (1.1 points), the highest since April 2012.

Confidence remained stable overall in Italy and Spain, but fell 1.0 point in the Netherlands.

Bailed-out strugglers Cyprus and Portugal showed improvement, marking their highest levels since July 2011 and August 2008, respectively.

The services sector did particularly well in January, gaining 1.9 confidence points.

Consumer confidence was up 1.8 points thanks to hopes of economic growth and subsequent job creations.

Ben May at Capital Economics said the figures pointed to "a solid but unspectacular start to the year" that could see annual GDP growth of over 1 per cent.

The rise "echoes the improvement in the other closely watched euro-zone survey indicators in suggesting that the economic recovery is slowly building momentum," he said.

"But the euro-zone's recovery looks set to remain distinctly lacklustre in comparison to those of the US and UK," he added.