Downturn has passed

Despite the pessimistic forecasts of last spring the business sentiment for large enterprises has improved in almost all industries. In several cases the improvement has been dramatic even though the business sentiment, for many industries, still is worse than normal. The attitude tends to be somewhat better for the service sector than for the manufacturing sector.

The forecast for the coming spring is optimistic and shows that the enterprises expect continued improvement over the coming six months. Construction is the only industry where a majority of the enterprises expect the business sentiment to deteriorate.

The position in the business cycle also seems to have moved forward the last six months. Last spring the majority of the industries considered themselves in a downturn in the business cycle. Now there are very few industries in a downturn, the exceptions being construction and healthcare. The position in the business cycle has very clearly either reached bottom or already begun an upturn. This indicates that the enterprises have passed the stage of a downward trend.

(source SCB, Oct. 2009)

The French business climate has improved again in October 2009

According to the business leaders of the main economic sectors, the French business climate keeps on improving clearly in October 2009. The indicator rises to 86 after 83 in September. That is 18 points above the minimum record reached in March 2009. It is then coming closer to its long-term average.
At the same time, the turning point indicator remains in the favourable zone since last July, after a year and a half in the unfavourable zone. This steadiness confirms the sign of a coming recovery.

Indeed, in nearly all economic sectors, business leaders’ answers do suggest an improvement in the French economic climate.

(source: INSEE)