Setback as sentiment in the eurozone tumbled for fifth month in a row

Sentix said that its monthly index tracking investor sentiment in the 17-nation currency bloc dipped to -30.3 in August, down from -29.6 the previous month, but slightly better than a Reuters consensus forecast for a drop to -31.0.

Comments from European Central Bank President Mario Draghi last Thursday indicating that the ECB could begin buying government bonds again to reduce surging borrowing costs in Spain and Italy appeared to have helped limit the damage.

The expectations component of the index improved slightly for the first time in many months, rising to -23.3 from -24.0 in July.

“The main reason for this was probably ECB President Draghi’s unusually energetic defence of the euro,” Sentix said in its report.

“The survey results suggest that this reassured investors, especially institutionals, that more decisive steps will follow (also from politicians) to save the common currency.”

Still, a sub-index on the current situation continued to fall in August, dipping to -37.0 from -35.0 the previous month.

This took the overall index to its lowest level since July 2009.

A separate index prepared for Germany dipped to 1.3 from 2.2, despite a slight improvement in the expectations compon- ent.

An index for the United States also fell, while one for Asia, excluding Japan, edged high- er.