France: Business confidence deteriorates further in October
October 21, 2011
In October, the business sentiment index published by the National Statistical Institute (INSEE) dropped to 97 points from 99 points in September, amid concerns that the European debt crisis and slowing global economic growth will crimp demand. The reading was below market expectations, which saw the index easing to 98 points, and marked its lowest level since July 2010. With the monthly decrease, business sentiment remains below its long-term average of 100 points for the second consecutive month. The fall in business confidence reflected deteriorations in the personal production outlook as well as demand and export order levels. The decline in business confidence does not bode well for economic activity in the months ahead. According to the Central Bank's monthly index of business activity (MIBA), GDP expanded 0.1% in the third quarter, which was unchanged over the previous months' estimate. Meanwhile, the INSEE expects GDP to have expanded 0.3% in the third quarter, according to its October quarterly economic outlook.