France Business Confidence July 2018


France: Business sentiment declines in July

July 24, 2018

The National Institute of Statistics and Economic Studies’ (INSEE) business sentiment index for the manufacturing sector declined from June’s revised 109 points (previously reported: 110 points) to 108 points in July. Despite dropping to the worst reading in one year, the indicator remained above the 100-point long-term average, the INSEE’s benchmark measure to distinguish between improving and worsening business expectations.

July’s reading reflected respondents’ more pessimistic views on the economy. New orders from domestic and foreign clients dropped steeply, and firms’ outlook on the sector deteriorated. Firms’ assessment of their own production expectations and expected workforce size declined in July. In turn, views on finished goods inventories remained unchanged, the only component that did not decline in the surveyed month.

Regarding the different industries in the manufacturing sector, sentiment deteriorated in almost all sectors, including the food products and beverages sector, and the machinery and equipment goods industry.

FocusEconomics Consensus Forecast panelists see fixed investment growing 2.8% in 2018, which up 0.2 percentage points from last month’s estimate. For 2019, the panel sees investment expanding 2.4%.

Author: Jean-Philippe Pourcelot, Economist

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France Business Confidence Chart

France Business Confidence July 2018

Note: Value of monthly business sentiment indicator index; long-term avg. at 100.
Source: National Institute of Statistics and Economic Studies (INSEE).

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