Belgians' Confidence Rises for First Time in 6 Months

By Jurjen van de Pol

Aug. 20 (Bloomberg) -- Belgian consumer confidence improved for the first time in six months in August as households worried less about economic growth and personal finances.

The sentiment index for Belgium, the sixth-largest economy in the euro area, rose to minus 11 from minus 13 in July, the National Bank of Belgium in Brussels said today in an e-mailed statement. The July reading was the lowest since 2005.

``Consumers took a less pessimistic view on the general economic developments'' and ``regard their future financial situation as slightly more favorable,'' the central bank said. ``On the other hand, the unemployment outlook has deteriorated further.''

The nation's economy outpaced the contracting euro region in the second quarter, expanding 0.3 percent from the previous three months. Still, that was the nation's slowest growth in more than three years and the jobless rate increased in July for the first time in 15 months, signaling employers' hesitance to hire after the Belgian central bank cut its full-year economic- growth forecast.

Belgian business sentiment probably dropped to a three-year low this month, according to the median estimate of 16 economists in a Bloomberg News survey, which sees the indicator falling to minus 8 from minus 7.6 in July. The business- confidence report, considered a leading indicator for Europe, will be released by the central bank on Aug. 22.

Sales Forecast

Belgacom SA, the country's largest telephone company, last month lowered its sales forecast as corporate clients cut back spending on network equipment, communication gear and integration services. The Brussels-based company now expects sales to drop 2 percent this year.

Supermarket operator Delhaize Group on Aug. 4 said its second-quarter revenue fell 7.5 percent and reiterated its July prediction that operating profit may not rise at all this year. The grocer last month cut forecasts for sales and profit as shoppers bought fewer items or opted for discount chains.

Consumers across the euro region are coping with surging food and energy prices, which have curbed their purchasing power. Households were more negative about their ability to save this month, with that indicator falling to minus 1 from 0 in July, according to today's report.

Inflation in Belgium accelerated last month to the fastest pace in almost a quarter-century as crude-oil prices jumped to an all-time high of $147.27 a barrel on July 11. Oil prices have declined 20 percent from that record, trading today at $116.18.

To contact the reporter on this story: Jurjen van de Pol in Amsterdam jvandepol@bloomberg.net