ESI climbs modestly. Export order books jump in eastern Europe
France’s Economic Sentiment Indicator started the new year modestly, up half a point to 99.2 despite a tenth consecutive increase while the Euro area’s increased three fold to 95.7. In the EU 27, business assurance rose substantially, over two points, to 97.1
Two of France’s four major trade partners observed mild ESI, Germany’s grew 0.6 points to 96.1, and Spain’s 0.3 points to 89 while Italy’s and the UK’s jumped respectively 4.2 points to 101.4 and three points to 98.2
Industrial confidence in France took a step back as the index slipped one point to -14 inversely to the Euro area’s, up two points to -14 and the EU 27 to -13. The UK posted the strongest increase, up seven points to -14, followed by Germany, up four points to -15. Spain’s rose two points to -21 and Italy one point to -10. Nordic member states’ industrial confidence performed unevenly : Finland’s fell one point to -9, Sweden’s gained two points to -7 and Denmark’s turned positive to 1 from -3. Eastern Europe’s largest economy, Poland, recovered from pessimism as the index increased three points to -16 along with Latvia, whose index skyrocketed nine points to -16.
Mild production expectations in France accounted for a lack of sustained industrial confidence as the index turned positive but only up one point to 1. The Euro area’s expectations rose two points to 5 and the EU 27 three points to 7 pushed up by the UK’s index, up seven points to 8 along with Poland‘s five points increase to 10. Of the Euro area, Spain’s production expectations turned positive, up three points to 4, Germany’s grew two points to 7 and Italy’s one point to 6.
Order books remained in the red throughout Europe although most member states climbed back nearing the surface. France’s index rose four points to -47, the Euro area’s climbed two points to -44 and the EU 27 three points to -43. Lithuania recorded the strongest increase, up 17 points to -54. With consumer consumption of manufactured products remaining sustained, France’s stocks of finished products fell five points to -5, while the Euro area’s and the EU 27 built inventories, each up two points respectively to 3 and to 4. In addition, production trends in recent months improved substantially throughout the Euro area where 10 member states indices out of a total 16 turned positive including France‘s, leading the EU 27 with 15 member states with a positive index. Export order books, still in the red, but continuously rising, also accounted for accrued upcoming production. France’s increased to -51 (from -58) the Euro area’s to -45 (from -49) and the EU 27 to -43 (from -47).
The UK performed best with an order index jumping ten points to -30. Germany’s index rose to -43 (from -49), Spain’s remained nearly unchanged at -48 (from -49) along with Italy’s at -46. Nordic states performed inversely with export order books deteriorating on average ten points. East European member states export order books leaped with Poland’s index increasing six points to -56, Hungary’s grew ten points to -39, Lithuania’s gained 11 points to -54 and equally Estonia to -39.
Employment expectations consequently rose in the EU 27, to -18 (from -21) while the Euro area’s stagnated realistically at -21. With inflation expected back at some point in the Euro area and in the EU 27, selling price expectations rose, on average four points and rather unevenly in eastern Europe. Capacity utilizations in the manufacturing industry in the first quarter, for data collected in January, edged modestly in the Euro area and similarly in the EU 27 pushed down by member states declining production capacity in the manufacturing industry, brought about by reduced estimated number of months’ production assured by orders on hand, on average 2.8 months compared with 3.3 months in Q4/09
