24 July 2019

2019- n° 190

In July 2019, the business climate has deteriorated in wholesale trade Bi-monthly survey of wholesaling - July 2019

According to the managers surveyed in July 2019, the business climate in the wholesale trade has deteriorated, but remains at a high level. The composite indicator loses two points and stands at 105, well above its long-term average (100). The May 2019 business climate indicator was revised upwards by one point as a result of the integration of late business responses and the revision of seasonal coefficients.

In July 2019, fewer wholesalers than in May reported that their total sales and deliveries received over the past two months were above normal. In particular, the balance of opinion on deliveries received from abroad has significantly decreased. On the other hand, the one on foreign sales has increased. These four balances on past activity remain above their long-term average.

In July, wholesalers' balance of opinion on the sector's overall business prospects was almost stable, as were those relating to orders to be delivered abroad and overall order intentions. These balances are well above their long-term average. However, the balance of opinion on foreign order intentions has sharply deteriorated and, although above its long-term average, is at its lowest level since early 2016.

The balance of opinion regarding past employment is almost stable; the balance of opinion regarding planned employment has improved. These two balances are above their long-term average.

In July, the balances regarding prices has continued to decline. The two corresponding opinion balances are well below their long-term average.

Almost as many wholesalers as in May consider their cash flow situation to be favourable. The associated balance is slightly above its long-term average.

The turning-point indicator has moved into the uncertainty area.

Business leaders' opinions have improved in the agricultural wholesale trade sector. The balance of sales volume has strongly recovered. It has reached its highest level since the summer of 2015 and is back to its long-term average level. Balances on foreign sales, order intentions and inventories have also improved. Each of these balances exceeds its long-term average. The balance of opinion on deliveries received from abroad has increased and is in line with its long-term average.

In the food wholesale sector, the balance of opinion on sales volume has fallen sharply despite a slight increase in that on foreign sales. In addition, the opinion of business leaders on their deliveries received from abroad has significantly deteriorated. The corresponding balance has returned to a level close to that recorded in March, thus falling back below its long-term average. The one relating to purchase intentions is stable above its average.

In the wholesale of domestic goods, the balances of opinion on sales are stable or almost stable. The opinion of business leaders on deliveries received from abroad has deteriorated significantly. The corresponding balance has fallen back below its long-term average. On the other hand, business leaders are more optimistic than in May about their order intentions. The latter balance is well above its long-term average.

In the wholesale trade of this type of capital goods, the opinion of business leaders has deteriorated again significantly in July. The balances relating to sales and purchases have fallen sharply. The balances of opinion on sales volume and order intentions are well below their long-term average. The one on order intentions has reached in particular a lower level since September 2014. The balance on inventories has grown strongly, well above its average.

In this type of wholesale trade, balances related to the volume of sales and deliveries received from abroad have declined, but remain above their long-term average. Conversely, those related to foreign sales and order intentions have increased slightly.

In this sector, more business leaders than in May have reported an increase in their sales and deliveries received from abroad. The balance of opinion on order intentions has fallen. All sales and purchases balances are well above their long-term average.