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Leading Indicators Show Accelerating Growth in Europe

17 June 1999

Auto Sales Especially Strong According to wittendal.com

    PARIS -- Performances of European consumer markets are likely to be above 
expectations this year.  Example:  sales of passenger cars will increase by more 
than 4%, a figure far more optimistic than mostanticipated.

    This is a forecast just released by wittendal.com, a research organization 
specializing in the economics of the industries in the European Union.

    According to wittendal.com, rising auto sales (new registrations already
up 7.6% from January to May on previous year level) reflect renewed consumer
confidence -- an effect of the "Euro-optimism" -- especially in Spain, in
France, in most smaller E.U. member countries, and to a lesser extent, in
Germany.

    The strength of consumer demand is also benefiting to industries producing
computers (June production volume leading indicator 14% above previous year
level) and other consumer electronics (June production volume leading
indicator at +7% compared to June 1998).

    The impulse of consumer demand is spreading to intermediate and investment
goods, both also benefiting from firming export and international demand.
Hence, most cyclical industries (paper, metal, glass, chemicals, plastics) are
already rebounding from a short contraction -- rebounding earlier than during
previous cycles.

    Moreover, the low Euro exchange rate gives a competitive advantage to
European investment goods industries, such as mechanical engineering,
electromechanical industries, aerospace, in a phase of firming demand from
Asian countries emerging from the financial crisis, and, indeed, also
benefiting from currency depreciation.  However, so far, Asian exports are
basically consumer goods, and target more the United States than European
markets.  Hence, in 1999, Europe is likely to gain market shares in world
trade.

    wittendal.com is an independent research organization located near Paris,
France.  It produces leading indicators, forecasts and assessments covering
economic developments in the manufacturing and construction industries
throughout Europe.

    Detailed information is available on http://www.wittendal.com .