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Eurozone investor sentiment surged in February, with the Sentix Investor Confidence index swinging decisively into expansionary territory and delivering a major upside surprise.

• Sentix Investor Confidence (Feb): 4.2 vs -0.2 expected, -1.8 prior

The jump from negative readings to a solid positive print signals a sharp improvement in risk appetite and growth expectations among investors, at least at the survey level. If sustained, this kind of sentiment turn can feed into stronger equity/credit tone and a firmer EUR bias, especially if upcoming hard data (PMIs, industrial output, spending) confirms the shift rather than fading it as a one-off rebound.

Switzerland’s SECO Consumer Climate index improved in Q1 to -30, up from -37 previously, signaling a mild recovery in household sentiment—though confidence remains firmly in negative territory.

The print matched expectations (-30), which typically limits immediate market impact. Still, the move higher is consistent with a “less-bad” demand backdrop and is generally marginally supportive for CHF at the margin, especially if it aligns with firmer domestic spending signals.

Germany’s December trade flows surprised to the upside. Exports rose 4.0% MoM (vs 1.0% expected, **-2.5% prior), signaling a strong year-end recovery in outbound demand. Imports increased 1.4% MoM (vs 0.2% expected, **0.7% prior), indicating firmer domestic absorption and/or higher energy/intermediate purchases. Net: the export surge is the key positive for growth optics, while the import rise suggests demand is not collapsing—supportive for the euro-area external picture if sustained.

France’s external balance deteriorated into year-end. The trade balance posted a wider €4.8B deficit in December (vs €3.8B expected, €4.0B prior), as imports rose to €57.9B (from €56.2B) outpacing exports at €53.1B (up from €52.2B). The current account also softened to a €0.60B deficit (from €0.30B), reinforcing the signal of a weaker net external contribution. One offset: France’s total reserve assets jumped in January to €409,263.0M from €362,743.0M, strengthening the reserve buffer even as the flow balances weakened.

Switzerland’s foreign reserves declined to $712.0B in January from $725.4B previously, a drop of about $13.4B. A lower reserve stock can reflect valuation moves (FX/gold), balance-sheet adjustments, or reduced intervention activity. For CHF, the signal is modest and indirect, but markets may read it as consistent with less aggressive reserve accumulation/intervention compared with prior periods.

Switzerland’s labor market softened slightly in January. The unemployment rate (n.s.a.) rose to 3.2% from 3.1%. On a seasonally adjusted basis, the unemployment rate (s.a.) printed 2.9%, a touch better than 3.0% expected and 3.0% prior. Net: a small headline uptick, but the adjusted measure suggests underlying conditions remain broadly stable. For CHF, the signal is neutral-to-slightly soft, with the bigger drivers still being global risk sentiment and SNB policy expectations.

Spain’s industrial production slipped into contraction in December, falling -0.3% YoY after a +4.6% prior reading. The sharp swing suggests a meaningful loss of momentum in the industrial sector into year-end—an incremental negative for Spain’s growth pulse and the broader euro-area manufacturing backdrop if confirmed by upcoming releases.

Germany’s data sent a mixed signal for the euro-area engine. The trade surplus rose to €17.1B in December (€14.1B expected, €13.6B prior), pointing to stronger net exports. But the production side weakened sharply: industrial output fell -1.9% MoM (-0.2% expected, +0.2% prior) and -0.55% YoY (vs +0.43% prior). Bottom line: external balances look healthier, yet domestic manufacturing momentum deteriorated into year-end—an uneven setup for EUR growth optics.

German factory orders jumped 7.8% MoM in December, massively beating expectations of -1.8% and accelerating from +5.7% previously. The upside surprise signals a strong year-end rebound in demand for German industry—supportive for the near-term growth narrative—but the size of the move also hints at potential volatility (e.g., large-ticket orders), so markets will watch whether the strength persists in the next prints.

France’s industrial production unexpectedly contracted in December, dropping -0.7% MoM versus +0.2% expected and +0.1% previously. The downside surprise points to a weaker year-end performance for the manufacturing/industrial sector and reinforces the broader picture of uneven momentum across the euro area.

Eurozone construction remained under heavy pressure in January. The HCOB Eurozone Construction PMI fell to 45.3 from 47.4, signaling a deeper contraction across the region. The sharpest deterioration was in Germany: HCOB Germany Construction PMI dropped to 44.7 from 50.3, flipping from marginal expansion back into clear contraction territory. France was essentially unchanged but still weak, with HCOB France Construction PMI at 43.5 (vs 43.4 prior). Italy held relatively better, though still contracting, with HCOB Italy Construction PMI at 47.7 (vs 47.9 prior). Bottom line: construction remains a drag on euro-area growth, with Germany’s reversal the key negative signal.

Italy’s December retail sales underperformed, falling -0.8% MoM (vs -0.4% expected, +0.5% prior), a sharp reversal that points to softer consumer demand into year-end. On an annual basis, sales rose +0.9% YoY but slowed from +1.3% previously reinforcing the cooling-consumption signal.