France: Strong Business Climate With Heavy Inflationary Pressures

Summary

  • In France, the business climate improved to 114, exceeding its already high level in June and remaining well above its long-term average.
  • However, this is mainly due to the service sector, which is a major risk given the evolution of the pandemic.
  • Surveys indicate that price pressures, which were already present in previous months, are now intensifying strongly.

Rising business climate indicates a solid economic situation in France

In France, the business climate improved to 114, exceeding its already high level in June and remaining well above its long-term average. The increase is notable in both the industrial and service sectors. In the industrial sector, the increase is mainly due to growing order books and mainly orders from abroad. In the services sector, the business climate is at its highest level since December 2000. The effects of the recovery are clearly being felt, with the balance of opinion of business leaders on activity over the last three months rising sharply to its highest level since 1990.

The French economy is driven by the services sector

Together with the PMI indicators for November, this data provides an interesting picture of the current economic situation in France. The French economy is mainly driven by the services sector. Buoyed by a strong labour market, the rebound in demand that followed the end of the restrictions in the spring is not yet over, and services continue to benefit from it. Meanwhile, the industrial sector is having to navigate between shortages of raw materials, longer delivery times for inputs, disruptions to supply chains and recruitment difficulties. Order books in industry are relatively full, but production is negatively impacted by these difficulties.

..

Source: https://seekingalpha.com/article/4471800-france-strong-business-climate-heavy-inflationary-pressures

 

Share this page Share on FacebookShare on TwitterShare on Linkedin
Close

Discover the 'Made in France à Bahrain' Guide

'Made in France à Bahrain' - Edition 2021
is YOUR guide to the economic presence in Bahrain. Click here to view the online guide