France: Business confidence shows divergent results
February 18, 2011
Forward-looking indicators for the manufacturing sector paint an ambiguous picture. While the Central Bank's sentiment indicator suggests a more upbeat confidence level among business leaders, survey data from the National Institute of Statistics (INSEE) point downward. The Central Bank's business sentiment indicator for manufacturers rose markedly from 107 points in December to 110 points in January. With the January increase, the index moved further above its long-term average of 100. However, more recent data on the economic climate in the manufacturing industry contrast the positive outlook implied by the Central Bank's indicator. The business sentiment measurement developed by the INSEE dropped from 108 points in January to 106 points in February as domestic demand slowed. The reading undershot market analyst expectations of 109 points. According to the Central Bank's monthly index of business activity (MIBA), the economy is expected to expand 0.8% in the first quarter, while the quarterly economic outlook released by INSEE in December has the economy expanding 0.3% in the first quarter.