LONDON—While the US economic outlook has become murkier because of the partial shutdown of the government, the picture in Europe—so long the laggard of the global economy—has brightened. Another round of economic data yesterday provided evidence that Europe’s recovery from recession is becoming broad-based and self-sustaining.
Particularly encouraging was the news that retail sales across the eurozone rose a forecast-busting 0.7 per cent in August from the previous month, according to Eurostat, the EU’s statistics office. Retail sales are an important barometer of economic confidence as they show consumers are more willing to spend rather than save despite many headwinds, such as high unemployment and government-imposed austerity measures. They are also a major component of growth.