France: Business confidence drops unexpectedly
January 23, 2013
The monthly business sentiment index published by the National Statistical Institute (INSEE) fell to 86 points in January from 89 points in December. The reading surprised market analysts, which had projected the indicator to reach 90 points in January. Thus, business sentiment remains well below its long-term average of 100 points.
In January, respondents assessed a deterioration in their past activity as well as in their production outlook. The monthly result reflected a weakening in most categories, in particular stock of finished products and export books. Meanwhile, total order books and general production outlook - which represents business leaders' opinion on French industry as a whole - were broadly steady and remain mired into negative territory.
According to the Central Bank's monthly index of business activity (MIBA), GDP is expected to have declined by 0.1% in the fourth quarter of 2012.