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KEY INDICATORS - Q4 2006 :Industrial output index france & euro area, order books, the labor market- metropole- , job offers, car registrations, company creations, consumer prices index - metropole-, annual inflation rate france-euro area-eu 25,

The overall industrial output index rebounded a slight +0.3% in Q4 following a disastrous previous quarter that had left production flat in twelve months. Nevertheless and in one year to December production rose +2% as the intermediate goods and capital goods sectors each maintained momentum throughout. 

In Q4, CAPITAL GOODS output index rose +0.6% and INTERMEDIATE GOODS +0.5% followed by CONSUMER GOODS milder +0.3% The FOOD & AGRICULTURE INDUSTRY saw output decline -0.6% while the AUTOMOBILE INDUSTRY production index slid again -1.4% This mild industrial surge left the energy output index to fall -1.9%

The CAPITAL GOODS production index stayed however in the lead despite its main categories underperformance : the boats-planes-trains-motorcycles production shed -1.2% and electric-electronic equipment a stronger -1.7% while the mechanical equipment output index grew +2.9% Out of the first component category, the shipyard products output index increased +2.6% in direct relation with strong order books. By contrast, the aerospace production index dipped -1.1% and the rolling railway equipment index an impressive -4.6% as the latter had recorded hectic output periods in October and November. The mechanical equipment category main component, metal products for construction, benefited from a vibrant construction context and saw output increase +2.8% despite cold weather temperatures in December.

The INTERMEDIATE GOODS sector nearly outperformed capital goods had it not included two categories heavily impacted downwards by the automobile sector and the aerospace recent crisis : the electric-electronic components production index fell -0.7% and the chemicals-plastic-rubber products -0.5% By contrast, all other categories production indices improved: the mineral products output index rose +1.6% wood-paper-cardboard products an impressive +1.4% underlining thus heavier order books overall, while the metal-metallic products output index rose similarly +1.4% The textile output index stayed quasi unchanged or +0.2%

CONSUMER GOODS did not fare as well as all categories recorded major slowdowns, with the exception of the pharmaceuticals-perfume-personal care products +1.8% gain unlike the clothing-leather -3.3% dive, printing-reprints -1.9% loss and home equipment quasi unchanged -0.2%

The AUTOMOBILE INDUSTRY output index recorded yet another production gap dragging along the auto equipment production index -2.1%

The ENERGY sector production indices reflected such uneven industrial context: the combustibles and fuels output index stayed quasi unchanged or -0.2% while the water-gas-electricity production index recorded a stronger -2.1% and despite record output in December due to unusually cold temperatures.

In the EURO AREA and in Q4 and according to Eurostat figures, industrial output (excluding construction) increased +0.3% and rose +0.6% in the EU 25. France underperformed compared with Germany’s quarterly average index at 113.50 Belgium’s 111.1 Luxembourg’s 117.8 and Hungary’s impressive 149.7 In December and in variances against November, the Euro area’s industrial output index rose +1.1% similarly to France’s and Belgium’s but Germany’s fell -0.6% while Hungary’s increased +2.2% Out of the EU 25 Denmark recorded the strongest output dip -2.7% rescinding from two previous hectic months (+3.6% in October and +1.5% in November) unlike Lithuania’s -5.3% output gap in December (-2.5% in October and +0.3% in November)

Capital goods output index increased +1% in the Euro area and +1.3% in the EU 25 Out of the Euro area, Germany’s capital goods production index rose +0.8% while Finland’s fell -2% following however record output for the three previous consecutive quarters. Out of the EU 25 Estonia’s record +9.3% production index gain performed best followed by Lithuania’s +5.1% Slovakia’s +4.7% and Poland‘s +1.6%

Source: Eurostat

Intermediate goods output increased +0.9% in each the Euro 25 and the Euro area. Best performers included Poland’s +3.3% output increase Estonia’s +2.2% and Lithuania’s +0.9% In the Euro area Germany’s +0.9% output gain along with Finland’s +0.6% production increase remained in the lead.

Source: Eurostat 

In one year, France’s capital goods and intermediate goods stayed in the lead out of all its own industrial sectors with production increasing respectively +4% and +2.1% The food and agriculture indystry production index remained unchanged or +0.2% while consumer goods rose a mild +0.6% The automobile industry production index fell -3.2% and energy an impressive -4.5%

Out of the Capital Goods sector, the mechanical equipment category performed best +6.9% with both November and December recording their best production periods as the metal for construction output index rose +2.8% The boats-trains-planes-motorcycles category saw production rise +2.2% performing inversely these same months but saw the shipyard production index rise +1.2% and rolling railway equipment a massive +20.1%. The aerospace component mild +1% gain impacted the electric-electronic equipment production index slow +0.7% rise.

The Intermediate Goods sector counted one underperformer - the electric electronic component output index fell -2.2% for reasons similar to its quarterly drop. The metal-metallic products index rose +4.9% as the metal for construction category stayed hectic and the mineral products production index +3.8% The textile products output index climbed steadily and gained +1% The wood-paper-cardboard products production index slightly rose +0.4% while the chemicals-plastic-rubber products output index grew +1.4%

Consumer Goods pharmaceuticals-perfumes-personal care products output index increased +5.1% unlike all other categories: clothing-leather saw production dive -6.3% printing-reprints -4.7% and home equipment -3.5%

The combustibles and fuels output index up to July mirrored the water-gas-electricity production index and, despite more volatile variances, fell -1.1% in one year. The water-gas-electricity output index declined a strong -5% on the same period due to a chronic water shortage although unusually cold temperatures in December forced production up that same month. Despite a rather slow economic context, each energy output stayed closely correlated to heavy industries respective production indices: the water-gas-electricity production index shadowed

Source: Insee

In the Euro area and in twelve months, according to Eurostat figures, industrial output excluding construction increased +4.2% and rose +4% in the EU 25. Best performers included Hungary’s +14% gain, Poland’s +10.4% Slovakia’s +8.9% and Sweden’s +8.4% Inversely, Lithuania’s industrial production index dipped -7.9% 

Order Books  : in Q4, industrial new orders increased +1.7% in the Euro area and +2.1% in the EU 25 according to Eurostat figures. East European member states recorded extremely high indices, except in December against the previous month, as orders shifted from low cost countries to the Euro area : out of that region, and on the same period, best performers included Ireland’s +21% massive order books increase (surging thus from December -11.4%) Portugal’s +9.3% and the Netherlands +4.2% France’s order books rose a milder +0.9% but Germany’s fell -1.4% Out of East European member states, Latvia recorded the hardest order books fall -22.9% but, out of the EU 25, Denmark’s +7.6% and Lithuania’s +3.5% recorded some of the best order books increases.

Source: Eurostat 

In one year to December, the Euro area order books index rose +1.6% and the EU 25 +2.5% France’s order books index fell -4.2% and Germany’s increase +2.8% Unlike their respective quarterly performances, East European member states’ order books jumped : Slovakia’s +36.4% Hungary’s +35.1% Latvia’s +33.5% and Bulgaria’s +29.7%

Capacity utilization in Q4  averaged 83.9 in the Euro area and 83.6 among EU 25 members reflecting thus a hectic industrial context especially for countries where output stayed vibrant throughout : Finland’s 89 and Sweden’s 89 rated the highest followed by the Czech Republic 88.4 Germany‘s 87.6 and Luxembourg’s 87.4 Out of East European countries where industrial output maintained high momentum, Slovakia recorded the highest capacity utilization 85.6 compared with Lithuania’ s lower 71.5 France rated 86.1

Source: Eurostat

On the same period, industrial domestic output prices remained in France at 111.3 one the lowest compared with the Euro area’s 116.54 index (or a slight -0.2% cut against the previous quarter) and the EU 25 119.06 index (or +0.2%) Finland’s domestic producer prices ranked first at 108.43 but increased +0.7%. Germany’s producer prices stood at a stable 117.8

THE LABOR MARKET - METROPOLE-  - Q4 2006                                                          

Overall unemployment fell -2.1% in Q4 to a total 2 375 000 million jobless remaining thus disappointingly above target as the under 25 unemployed rate stagnated or +0.1% to 564 000 jobless. The 25 to 49 age group saw unemployment decline -2.5% to 1 428 000 million jobless, the highest in numbers, while the over 50 jobless rate dipped -2.8% to an artificial 384 000 unemployed since a large majority remains unaccounted for due to an official job search exemption because of their age. 

Per gender and on the same period, male unemployment fell -1.7% to 1 168 000 million jobless and dropped -2.4% to 1 207 000 million for females. Both young male and young female jobless rates remained dramatically unchanged respectively +0.3% to 298 000 unemployed and a stagnant 266 000 jobless and thus for an entire six month period. The intermediate age bracket jobless rates fell unevenly : female unemployment dropped -2.8% yet to a high 753 000 jobless compared with -2.1% for males to 676 000 unemployed. The over 50 male jobless rate, higher than females, fell -3.5% to 195 000 unemployed while female unemployment declined -4% 189 000 jobless. Per age group, the 25 to 49 age bracket accounted for the highest number of jobless but also declined the fastest, on average -3% per quarter.

In one year, overall unemployment fell -10.3% to 2 352 000 million jobless impacted by all age groups: the under 25 unemployment rate dropped -4.4% to 560 000 while the intermediate age bracket, 25 to 49, saw unemployment dip -12% to 1 413 000 million jobless. The over 50 jobless rate fell at a similar but artificial rate to 379 000 due to the job search exemption specific to that age group.

Per gender, female unemployment fell faster, -11.2% or 1 194 000 million against

Source: Insee 

Reasons for unemployment registrations recorded the usual year end upward trend for registrations due to the end of temporary jobs +7.7% in Q4 to 103 246 new registrants, while registrations due to the end of short term assignments (under 6 months) fell -4.8% to 37 674 new registrations. Each registration criteria underlined thus an atone labor market whereby the lack of perspective, for either stable contracts or contract renewals, worsened. On the same period, registrations due to lay-offs fell -5% to 15 685 registrants despite nearly daily lay-offs plan announcements, as by law, employers’ obligation to set up training or outplacement groups prior to down staffing, often halves the actual number of newly jobless workers.

Source: Insee

In one year to December, registrations due to the end of short term assignments (under 6 months) dipped -11% outperforming thus potential full time positions and increasing by the same token precarious working conditions. Similarly, registrations due to the end of temporary jobs increased +0.8% and registrations due to lay-offs declined -13.7%

JOB OFFERS increased +3% overall in Q4 and mirrored per category previous years slow down recorded systematically on the same period to the detriment of the labor market : long term offers (over 6 months and in gross figures) declined from October -6.3% (but not as alarmingly as the previous year -15.4%) and slid further -11.3% the following month leaving the quarter to end on a negative trend -3.2% to 122 629 offers. Short term offers (under 6 months and in gross figures) dipped -12.8% to 98611 offers (and collapsed a record -21.3% alone in December) Occasional job offers (in gross figures) impacted the most, dived -25.7% to 36055 offers due to October -26.7% gap, an improvement however compared with last year’s quarterly negative performance.

Source: Insee 

In one year to December, overall job offers fell -4.7% to 284 400 offers impacted by seven negative performances out of a 12 month period and stayed dwarfed by unemployment figures expressed in millions.

Long term job offers (over six months and expressed in gross figures) declined -6% due to major gaps (-10% in February -19% in April -18.3% in July and -17% in December) reflecting a disastrous labor market as hectic periods such as summer underperformed. Short term job offers (expressed in gross figures and under six months) dipped -5% and followed a roller coaster pattern those same months while occasional job offers -1.8% decline fared identically

 CAR REGISTRATIONS - Q4 2006                                                           

Overall car registrations rebounded +18% in Q4 as the third quarter had recorded the worst sales season due to the summer recess in addition to inflationary crude oil prices. In one year and as a direct result of such gap, car registrations declined -11%

Compared with the previous quarter, new French car registrations increased +20.1% in Q4 outperforming new foreign cars +15.4% including in volume thanks to various incentives pushed towards buyers nearly all year long. Second hand car registrations by contrast only rose +4.6% but remained in the lead volume wise with 453 000 units sold compared with 160 700 new cars. With diesel engine cars remaining favorites due to gas prices, new diesel engine car registrations +18% market share gain was nevertheless shadowed by gas engine cars +17% but not in volume: the former represented nearly three times the number of cars sold or 117 600 units compared with 42 400 cars for the latter.

Source: Insee 

In one year and unlike previous periods, all car registrations recorded massive declines due to very slow sales in December as a pause from a hectic October month. As a result, new French car registrations dipped -10% and new foreign cars -12.3% New gas engine car registrations collapsed -25% while new diesel cars sold fell -5.1% nearly as much as second hand cars -5% drop. Best performers all year long remained new diesel engine cars with three positive consecutive quarters except for August solely due to summer vacations, and a record +20% car registrations in October. Second hand cars followed a similar pattern including +16.2% in October alone. New French car registrations recorded their best sales period in the first two quarters as the summer recess -July and August - saw sales record their first drastic declines respectively -42.4% in July and -23.2% in August but +18% in October. By contrast, new foreign cars recorded their best sales periods more unevenly (in March, May and June and October) similarly to new gas engine cars. 

Source: Insee 

 COMPANY  CREATIONS - Q4 2006                                                           

Company creations increased +4.8% in Q4 to 25 204 new entities and grew +5.5% in one year. The last two quarters consecutive upsurge accounted for the fastest company creations growth rates. Per sector and in the fourth quarter, the food and agriculture industry new entities rose the most +9.7% to 331 new businesses followed by the capital goods sector +6.1% to 213 entities. Commerce saw new companies grow +6.1% to 6103 following a dip the previous quarter while the construction sector stayed on a strong momentum with new entities climbing +6.2% to an impressive 4450 businesses. The intermediate goods group new entities recorded a slower creation increase +2.2% to 297 entities similarly to the transport group +2.6% to 562 companies.

Services to companies saw new entities rebound +4.8% to 5454 while financial services new businesses grew +3.4% to 386 The education-health-services group rose +3% to 1890 new entities while the real estate sector increased a slight +0.8% to 1624 new businesses.

In one year and due to properties inflationary prices, the real estate sector new companies dropped -8% The transport sector new companies jumped an impressive +31.4% The capital goods sector ranked second with new entities increasing at a sustained +14.6% and intermediate goods +8.7%

The commerce sector new entities rose +7.5% and construction +7.4% while the services to companies group saw new companies climb +4.5%

The consumer goods sector recorded one of the lowest company creation rates +2.9% while the financial services new entities fell -0.8% and education-health-services -0.9%

 CONSUMER PRICES INDEX - METROPOLE - Q4 2006                                       

Source: Insee

The Consumer prices index stayed nearly unchanged in Q4 or -0.1% as the energy index had rescinded from earlier inflationary pressures and dropped -4.8% The oil products price index fell -7.9% on the same period allowing for domestic fuel home delivery (1000 l) to drop substantially -8.8% as the index reflected trading prices (USD crude oil/barrel) -14.5% drop and -15.5% expressed in Euro/barrel. Out of the index categories, the manufactured products index increased the most +0.9% due to the clothing and shoes component jumping +5.2% By contrast, the health products price index declined a slight -0.3% and other manufactured products mostly unchanged or +0.1% The food price index remained the same or +0.1% as fresh produce prices fell -0.5% and fresh fruit an impressive -4.5% The tobacco consumer price index stayed stable at 178.19 Out of the services category, transport and communication fell -0.5% while rent recorded the usual +0.5% increase.

In one year, the overall index increased a steep +1.5% impacted by food, rent and energy : the food price index rose +1.7% as fresh produce jumped +3.7% due to heating costs, although the fresh fruit index had declined -1%

The rent price index grew +3.3% and the energy index by half. In Euro, crude oil prices/barrel fell -1.7% leaving domestic fuel prices (1000 l home delivery) to decline -1.4% equally to crude oil prices expressed in Euro. Nevertheless, prices jumped +9.7% in USD rendering cost higher in dollar terms as the dollar fell -9.5% against the Euro on the same period. The manufactured products price index did not quite soften the overall upward trend and declined a mere -0.2% while health products dipped a substantial -3.3% The clothing and shoes component price index rose +0.6% Other manufactured products prices index increased +0.4% Out of the services category and besides rent, the transport and communication price index fell -0.4% The tobacco price index stayed nearly unchanged or +0.1%

ANNUAL INFLATION stood at 1.7% in France in December compared with a steeper 2.2% in the EU 25 and 1.9% in the Euro area, according to Eurostat figures. That same month, the lowest rates were recorded in the Euro area by Finland at 1.2% Germany 1.4% and Austria 1.6% while Greece recorded one of the steepest annual inflation rates at 3.2% along with Ireland. Out of the EU 25 Latvia’s 6.8% recorded the highest rate along with Hungary’s 6.6%

Measured in HICP, the tobacco and drinks component recorded the highest annual inflation rate 3.2% while the lowest rates included clothing 0.9% besides a stable leisure and culture rate at zero. The communication component recorded the only index decline -2.3% while the energy HICP annual inflation rate stood at 2.9%

EU 25: Austria, Belgium, Finland, France, Germany, Greece, Spain, Ireland, Italy, Luxemburg, the Netherlands, Portugal, the Czech Republic, Cyprus, Denmark, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, Slovenia, Sweden, the United Kingdom

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