BRUSSELS (AFP) - Eurozone figures to be released this week should show business confidence beginning to slide again owing to concern over slowing growth and the strong euro, economists said.
In Britain, a more quiet week was in prospect, with economic data not likely to shed much more light of the state of the wider economy.
The key eurozone release -- Germany's IFO business climate index for November -- is expected to dip following a rise in October.
"Last month, the IFO business climate index edged higher against forecasts of a decline," HSBC economists said.
"In November, we expect the overall IFO business climate index to fall from 95.3 to 94.3, reflecting such factors as the rise of the euro and disappointing economic releases."
Bank of America economist Lorenzo Codogno agreed.
"Following the significant decline in the ZEW index recorded in November, we think there is a good chance to see an equally weak IFO reading," Codogno said.
"Slower global demand, domestic demand not picking up, higher oil prices and the sharp appreciation of the euro all combine to enhance the downward risk of the outcome of the IFO survey," he said.
Belgium's closely-watched business confidence indicator for November is also forecast to have deteriorated markedly.
"The business confidence index was unchanged last month. But we expected a renewed fall in the index on the back of the continued slowdown in Belgium's EU trading partners and further euro strength," Royal Bank of Scotland economists said.
Forecasts for Italian business confidence in November were just as gloomy.
Royal Bank of Scotland economists noted that the Italian index stagnated last month, with slowing growth in the country's trading partners and high oil prices dampenening manufacturers' confidence.
"These influences will have continued to weigh on confidence this month, as will the record high euro-dollar exchange rate," they said.
Among other data, the breakdown of German gross domestic product figures for the third quarter is likely to confirm slowing export growth in the euro zone's biggest economy.
"The export boom in Germany is ending and we expect a sizeable shift in the net export contribution to GDP growth from a positive 0.5 percent in the second quarter to a negative 0.3 percent in the third quarter," Codogno said.
"Consumption should have remained weak, posting a meagre 0.1 percent quarter-on-quarter rise," he said.
Royal Bank of Scotland economists said the figures are "likely to show that the slowdown (in growth) was due principally to flagging net exports".
They added that the "global soft patch and strong euro are finally taking their toll".
In Britain, the key piece of information was to come Friday when third-quarter GDP numbers are released.
The preliminary figure was disappointing, with growth of just 0.4 percent from the previous quarter and 3.0 percent from a year ago. Analysts broadly expect no change to the initial estimate, which was the slowest pace of growth since the first quarter of 2003.
John Butler, economist at HSBC, explained that the data was proving to be a bit problematic.
On the one hand, industrial production data was much weaker than expected and could on its own shave GDP growth to 0.3 percent. But even a 0.4 percent rise was hard to reconcile with survey evidence as well as the data on the expenditure side, he said.
"We expect GDP growth will be unrevised at this stage from the preliminary estimate. This release will provide a breakdown of expenditure. We expect weaker consumer spending, a small rise in business investment and flat net trade," Butler added.
11/21/2004 - 08:07 GMT - AFP