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Already at a very high level, the business climate in manufacturing further strengthens in JanuaryMonthly business survey (goods-producing industries) - January 2018

According to the business managers surveyed in January 2018, the business climate in industry has strengthened again. The composite indicator has increased by one point and and has returned to its November level (113), well above its long-term average (100).

Informations rapides N° 12
No 12
Principaux indicateurs
Paru le : 26/01/2018
Prochaine parution le : 22/11/2018 at 08:45 - November 2018

According to the business managers surveyed in January 2018, the business climate in industry has strengthened again. The composite indicator has increased by one point and and has returned to its November level (113), well above its long-term average (100).

Graph 1 – Business climate in industry - Composite indicator

The turning-point indicator remains in the zone indicating a favourable economic outlook.

Graph 2 – Turning-point indicator

  • How to read it: close to 1, the indicator points to a favourable short-term economic situation (-1 is unfavourable). The uncertainty area is between -0.3 and +0.3.

General production prospects are at their highest since July 2000

The balance of opinion on past activity, already significantly above its average in January, is back on track. The one about their personal production expectations is stable, far above its long-term average.

Manufacturers are even more optimistic than at the end of 2017 about general production prospects for the sector. The corresponding balance has continued to rise and has reached its highest level since July 2000.

The balance on export order books has slightly increased again and has reached its highest point since December 2007. That on overall order books has also risen and has reached its highest since March 2008.

Lastly, nearly as many industrialists than in December consider that their finished-goods inventories are above normal. The corresponding balance nevertheless remains below its long-term mean.

Table 1 – Industrialists' opinion on manufacturing activity

Balance of opinion, in %
Industrialists' opinion on manufacturing activity
Manufacturing industry Ave.* Oct. 17 Nov. 17 Dec. 17 Jan. 18
Composite indicator 100 111 113 112 113
Past activity 5 16 26 20 22
Finished-goods inventory 13 5 7 4 3
Overall order books –18 0 1 –2 1
Export order books –14 1 0 2 3
Personal production expectations 5 17 15 16 16
General production expectations –8 30 31 30 34
  • * Long-term average since 1976.
  • Source: INSEE - Monthly business tendency survey in industry

In the food and beverage production industry, the business climate indicator has inched down again

In the manufacture of food products and beverages, the business climate has inched down again in January. At 110, it remains well above its long-term average. This slight weakening mainly comes from a fall in the balance of opinion on past activity.

The business climate has reached a ten-year high in the manufacture of machinery and equipment goods

In the overall manufacture of machinery and equipment goods, the business climate has continued to rise. The composite indicator stands at 114, further exceeding its long-term mean. In January, the increase mainly comes from that of the balances on overall and export order books.

The business climate has improved in machinery and equipment and in the computer, electronic and optical product industry, while faltering in electrical equipment.

The business climate remains at its highest since mid-2001 in the manufacture of transport equipment

In the manufacture of transport equipment, the business climate has slightly improved. At 111, it stands at its highest level since June 2001. This increase is mainly due to the rise in the balance on global order books.

The business climate has improved in other transport equipment. However it has declined in the manufacture of motor vehicles, trailers and semi-trailers, while remaining far above its average.

The business climate is stable in “other manufacturing industries”

In overall “other manufacturing”, the business climate is stable, after peaking in November at its highest level (112) since January 2001. The increase in the balance on past activity offset the decrease in those on personal production expectations and on export order books.

In particular, the business climate indicator has declined in wood-paper and brightened in clothing-textiles and “other manufacturing industries”. It is stable in all other subsectors.

Graph 3 – Business climates in a sector-based approach

  • Legend: (C1): Manufacture of food products and beverages - (C3): Machinery and equipment goods - (C4): Manufacture of transport equipment - (C5): Other manufacturing

Table 2 – Business climates in a sector-based approach

Average = 100 and standard deviation = 10 since 1990
Business climates in a sector-based approach
NA* : (A17) et [A38 et A64] Weights** (%) Nov. 17 Dec. 17 Jan. 18
(C1) Man. of food products and beverages 22 113 111 110
(C3) Machinery and equipment goods 11 110 112 114
[CI] Computer, electronic and optical products 3 111 111 113
[CJ] Electrical equipment 3 109 113 111
[CK] Machinery and equipment 5 108 108 112
(C4) Man. of transport equipment 15 109 110 111
[CL1] Motor vehicles, trailers and semi-trailers 7 113 114 111
[CL2] Other transport equipment 8 103 103 106
(C5) Other manufacturing 46 112 110 110
[CB] Textiles, clothing industries, leather and footwear industry 2 112 110 116
[CC] Wood, paper, printing 5 113 117 114
[CE] Chemicals and chemical products 9 105 109 109
[CG] Rubber and plastic products 7 119 111 111
[CH] Basic metals and fabricated metal products 11 111 106 106
[CM] Other manufacturing industries 9 108 106 108
  • * NA: aggregated classification, based on the French classification of activities NAF rév.2.
  • ** Weights used to aggregate sub-sector's balances of opinion.
  • Source: INSEE - Monthly business tendency survey in industry