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Economy in Brief

BOF Industry Indicator Continues to Drop
by Robert Brusca May 19, 2008

The Bank of France indicator for industry stands near the bottom quartile of its two-year range and is beginning to break more decidedly lower (see chart). The production index is at a 2-Yr low. Overall order books are the weakest they have been in two years. Job market readings for current and expected conditions are near mid-range.

For French production the weakest sector is agriculture and food. Production in the consumer goods sector is in the bottom quartile of its range. Capital goods is an enduring exception with production near the top third of its range. The capital goods sector continues to the firmest sector among most e-Zone countries.

The performance of orders by sector is approximately the same as it is for production with food very weak. The consumer sector also is weak and stands very low in its two year range; capital goods orders again are in the top third of their range.

On balance the Bank of France Survey agrees with the notion that the e-Zone is slowing. Food and consumer goods are the weakest sectors with capital goods being dragged lower, but still showing relatively firm readings for now.

Bank of France Monthly INDUSTRY Survey: SUMMARY
        12 MO Since Jan-87 2Yr Percentile
  Apr-08 Mar-08 Feb-08 AVERAGE Average rank/range
Production-latest month
Total Industry 3.36 0.35 3.71 6 7 26.2%
Production Outlook
Total Industry 5.45 13.2 12.26 16 15 0.0%
Overall order books 17.64 18.24 22.11 25 5 0.0%
Foreign Orders 9.7 2.39 9.81 10 8 30.6%
New Orders
Total Industry 8.95 1.36 8.3 9 9 37.1%
Stocks: Finished Goods
Total Industry 0.63 0.62 -3.21 -2 -2 93.2%
Capacity Utilization 83.15 83.12 83.33 83 83 48.2%
Latest Month -0.4 -2.68 0.14 0 -1 51.6%
Outlook -2.81 -3.81 -0.49 -2 -3 53.7%
Industry Sentiment Index 100.81 104.29 105.99 106 107 0.0%
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