In December, European Commission’s economic confidence extended its downtrend, falling for a tenth consecutive month. Economic confidence dropped from an upwardly revised 93.8 to 93.3, exactly matching expectations. The details show that industrial confidence stabilized (at -7.1) and also construction confidence stayed broadly unchanged (-25.2 from -25.0). Services- (-2.1 from -1.6), retail- (-11.7 from -11.1) and consumer confidence (-21.1 from -20.4) on the contrary, weakened further in December. National data show a mixed picture as economic sentiment picked up in most core EMU countries (Germany, France, Belgium and the Netherlands) and in Greece and Portugal. In Spain (89.7 from 91.0) and Italy (85.5 from 90.1) economic sentiment worsened sharply in December. Traditionally the Commission confidence indicators are somewhat lagging the PMI’s and therefore it might have been too early for an improvement in those indicators. We hope to see some progress in January data, but the uptick in the core countries is an encouraging sign.