French Business Confidence Steadies, Industrial Demand Falls

4/22/2011

(RTTNews) - Confidence among French manufacturers remained unchanged in April, while business leaders said industrial demand has slipped during past three months.
French statistical office INSEE said the headline business confidence index for the manufacturing industry came in at 110 in April, unchanged from March. Economists had expected the reading to hold steady at previous month's original score of 109.
Confidence among retailers, construction firms and service providers improved in April. Manufacturers expect activity to slow slightly in the next three months. The production outlook index remained unchanged at 20 in April. March's score was revised down to 20 from 21 reported earlier.
Separately, a quarterly business survey by the statistical office showed that total industrial demand declined in the first three months of the year. However, the outlook remained unchanged. The index for current demand fell to 21 from 29, while that for expected demand remained unchanged at 7.
Overseas demand increased sharply, with the corresponding index rising to 36 from 26 in the fourth quarter. The outlook weakened and the index sharply fell to 16 from 23.
According to business leaders, industrial manpower continued to increase in first quarter. The corresponding balance was at its highest level for three years. The survey respondents expect a further increase in manpower in the second quarter.
Yesterday, a key survey showed that German business confidence weakened in April. Survey results from Munich-based Ifo Institute for Economic Research on Thursday showed German business sentiment falling for the second consecutive month in April, with firms turning more downbeat about the future operating conditions.
Meanwhile, a significant declined was observed in Belgian business morale after nine consecutive months of improvement, according to data from the National Bank of Belgium.
These are some of the first survey results to emerge after the European Central Bank lifted its key interest rate by 25 basis points to 1.25 percent earlier this month, after keeping it frozen at record low since July 2008.
Latest survey of Bank of France for March showed that business sentiment remained stable for the second successive. The bank had slashed the growth outlook for this quarter, while Finance Minister Christine Lagarde said last week that the ministry is cutting the forecast for next year.