Published on 14 June 2024
The Banque de France publishes a range of monthly and quarterly economic surveys that provide a snapshot of the French economy in the form of business climate indicators and short-term forecasts.
According to the business leaders surveyed (approximately 8,500 companies and establishments questioned between 26 April and 6 May), activity rose in April in market services, and more markedly than expected last month in industry and construction. This helped businesses catch up after a sluggish March and prepare for the prospect of a leaner May due to holidays and closures associated with the number and timing of public holidays. The business forecasts for May indicate that activity should decline in industry and construction, while little change is expected in services. However, these expectations should viewed with a degree of caution given the calendar effects during the month. Order books are still deemed weak in almost all industrial sectors, with the notable exception of aeronautics. In the structural works sector, orders remain well down on pre‑Covid levels due to stagnation in the construction of new builds.
Price moderation continued. According to business leaders in industry, raw material prices continued to decline though at a slower pace. In April, the proportion of businesses increasing their prices in industry and construction (6% and 2%, respectively), was a little below pre‑Covid April levels. At the same time, the proportion of businesses reporting a drop in their prices (5% and 8%, respectively, in industry and construction) exceeded pre‑Covid levels. In services, the proportion of businesses reporting a rise in their prices (12%) has not yet completely returned to normal.
Recruitment difficulties continued to trend slowly downwards, but remained high: they were cited by 38% of businesses in April, compared with 39% in March.
Based on the survey results as well as other indicators, we estimate that GDP should increase slightly during the second quarter of 2024 after a 0.2% increase in the first quarter.
However, this forecast is still very provisional, due to the unusual nature of the calendar in May 2024 and the forthcoming change in benchmark (on 31 May) for the national accounts published by INSEE.
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Updated on 14 June 2024