ECB Warns of Deteriorating Consumer Spending Amid Ongoing Conflict

The European Central Bank (ECB) has reported that consumer spending in the eurozone declined sharply during the initial weeks of the US war on Iran. This downturn is attributed to a weakening of consumer confidence, which remains below pre-war levels. The ECB warns that renewed escalation could further dampen consumption.

According to Reuters, annual nominal consumption growth slowed to approximately 2.5 percent in April from 3-4 percent since mid-2024. This decline suggests that the war on Iran has had a significant impact on consumer spending in the eurozone.