The French economy is approaching the summer period without much enthusiasm and the government will certainly have to take this into account over the coming months. According to INSEE indeed, “the business climate in France darkened somewhat” in June. The indicator calculated by public statisticians to summarize this climate loses two points. And finds himself at a level which is close to that which was his a year earlier. The employment climate is still deteriorating for the third consecutive month.
The details of the data published by INSEE on Thursday also show that for the time being, the impact of the international crisis affecting France is not felt in the same way by all business leaders. It cuts France in two: the relative confidence in the future of industry bosses contrasts with the gloom displayed by their colleagues in the retail trade, services and also, to a certain extent, those in the building industry.
Retail pessimism
In industry, “all the balances of opinion relating to production (…) are up in June”, summarizes INSEE . And even inflationary pressures seem relatively less weighty: the balance of opinion on the expected trend in selling prices, which had reached a level deemed “unprecedented” the previous month, has fallen back a little. But it “remains very high”, underlines INSEE.
The situation is very different in the other sectors of activity. It is in particular in retail that the bosses are brooding over. “Retailers’ opinion on the business outlook for the next three months is deteriorating: the balance relating to the sector’s general business outlook is falling and falling below its average level. The balances of opinion on ordering intentions and expected sales are also clearly decreasing and moving away from their average,” explains INSEE.
On the price side, little change in sight as inflation has reached levels not seen since the 1980s in recent months . The balance of opinion of business leaders on the evolution of expected prices “falls back slightly but remains at a very high level”, explains INSEE. This may well continue to curb consumption, while the summer sales have just started.
Same gloom in services. “The balances of opinion on the general outlook for activity in the sector and on expected demand have fallen back sharply”, indicate the public statisticians. And on the price side, the trend is still on the rise.
A trompe l’oeil improvement in the building
There remains the somewhat special case of the building. From a general point of view, the business climate is improving slightly. But this improvement should be put into perspective.
Above all, it is due to the fact that activity in the sector over the past three months has turned out to be better than expected. On the other hand, “they are much less optimistic about their planned activity”, explains INSEE.
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