Bank of France reports industrial output generally stabilized in May 1997
BANK OF FRANCE, MONTHLY BUSINESS SURVEY, 17/06/97.
According to business leaders surveyed by the Banque de France, industrial
output generally stabilized in May, following a sharp upturn in April. The automobile sector
was the only one to register a decline, which was accentuated by calendar effects.
The capacity utilization rate fell back slightly from one month to the next.
Overall demand changed little. On the domestic market, inter-industry demand
was less buoyant than in April, whereas foreign demand, boosted by the strength of the dollar
and the pound sterling, remained firm. Orders continued to stream in from English-speaking,
Asian and East European markets.
Order books were considered to be at normal levels across the different sectors,
and they appeared on the full side in the business equipment sector. Inventories, which fell
back, now seem to be at the desired level.
Over the coming months, industrial output is likely to advance appreciably in all
sectors. The best performances are expected from the food-processing industry and the capital
and intermediate goods sectors.
Commodity prices edged up, notably in the food-processing and capital goods
sectors. These increases were only partially passed on to finished product prices, which rose
only in the food processing industry, while remaining unchanged for consumer and intermediate
goods and dipping in the capital goods and automobile sectors.
The installation of new equipment, which was judged necessary at the beginning
of the year, is taking place only very gradually, in particular at small and medium-sized
companies.
perked up considerably in May.
Retail activity
in industry showed little change, except for the automobile
Employment levels
industry where cutbacks continued. They fell slightly in the building sector, whilst holding
steady in the retail and market services sectors. Permanent staff levels showed no significant
change, although certain companies - primarily those engaged in seasonal activities as in the
food-processing industry - made increased use of temporary staff.