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 EN FRANCAIS

KEY INDICATORS Q3 2007: industrial order books,gdp,construction output, external trade, producer prices index, household consumption of manufactured products,farm products producer prices index,the labor market, company creations,consumer prices index, inflation, industrial output index,turnover indices

Source: Eurostat & Insee

In the EU 27 and in one year , the highest increases were recorded by Poland +81.6%, Hungary +33.3% and Lithuania +28.2%, but order books dipped in Denmark -18.4%, Italy -1.8% and fell -0.4% in the Netherlands. In September however the order books index fell -2.3% with Foreign order books dipping -3.1% Overall, the index downward trend resulted from Intermediate Goods -3.9% decline followed by Investment Products -1.6% (auto industry, mechanical products, electric & electronic equipment) and Non Durable Consumer Goods -1.9% The Durable Consumer Goods order books index rose +1.5% In one year to September, the index rose +3.2% and Foreign order books climbed +2.8% Intermediate Goods order books increased +4.7% with work on metal and metallic products jumping +9.5% The Investment products index grew +1.7% and Durable Consumer Goods +1.2% The Non Durable Consumer Goods index gained +4.6% with pharmaceuticals-perfumes-personal care products increasing +5%

GDP rose +0.7% in the Euro area in Q3 and +0.8% in the EU 27 compared with the previous quarter, according to a Eurostat flash estimate. FRANCE’s grew at the same rate similarly to Germany. In the US, GDP grew +1% and in Japan +0.6% In Q2 GDP had increased +0.3% in the Euro area and +0.5% in the EU 27. Compared with Q3 of last year, GDP increased +2.6% in the Euro area and +2.9% in the EU 27 (in Q2 GDP grew respectively +2.5% and +2.8%) FRANCE's rose +2.1% and Germany +2.5%  On the same period in the US, GDP rose +2.6% and in Japan +2.2% (in Q2 respectively +1.9% and +1.5%) 

CONSTRUCTION OUTPUT INDEX - Q3 2007                                                         

The CONSTRUCTION OUTPUT index fell -2.1% compared with September but the index remained stable in the Euro area and similarly in the EU 27. East European member states initiated a construction slow down following uninterrupted hectic activities, with the exception of  ROMANIA +2% construction increase. Slovenia’s construction index fell -2.8% (+2.7% in August) and Poland's -3.4% . 

Source: Eurostat

In one year, FRANCE’s construction output rose +3.1% (+7.2% in August) and a milder +1.5% in the Euro area compared with +2.5% in the EU 27. Sweden’s construction output dipped -10% Portugal and Spain each -4% Germany -2% Out of East European member states, Romania’s construction output jumped +37.5% Slovenia’s a more modest yet vibrant +4.6% (+48.7% in April) Slovakia +3.7% but declined -0.8% in the Czech Republic. In 2006, the EU 27 construction index had increased more significantly +3.6% (almost unchanged in the Euro area +2.5%) 

EXTERNAL TRADE - Q3 2007                                                         

EXTERNAL TRADE performed in a roller coaster manner throughout the quarter as early as July when the trade gap worsened to €-3.04bn to a 12 month cumulative

€ -30.347bn compared with €-28.860bn in June, according to the Custom and Duties Bureau of Economic and Statistical analyses figures. Total exports increased a mild +0.4% compared with the previous quarter to € 33.962bn while imports rose +2.8% on the same period to € 37.266bn. By August, the TRADE deficit slightly improved € -2.8bn but worsened in one year to € -30.7bn. Total exports increased +3.9% compared with the previous three month period to € 34.7bn and +5.2% in one year. Imports jumped +4.6% to € 37.5bn due mostly to Consumer Goods and Intermediate Goods for the majority from the EU. In one year imports rose +5.9%

PRODUCER PRICES INDEX - Q3 2007                                                         

Industrial PRODUCER PRICES index for the domestic market (excluding construction) stood at 114.3 or +0.4% compared with August and only ranked second to Finland’s 109.5 index for the eighth consecutive month. The Euro area’s steeper 119.6 index increased similarly to France’s.

FARM PRODUCTS PRODUCER prices jumped +6.2% and +18.3% in one year impacted by grains +10.8% increase and +38.6% in one year,according to figures released by Insee. Cereal prices soared +20.5% in September with soft wheat rising +23.2% barley +22.6% and corn +14.3% Oil seeds recorded a steep +12.5% increase and protein-seeds (such as soya) an alarming +24.7% Vegetables and Fruit mirrored theses inflationary trends and increased respectively +5.4% and +5.7%

Household CONSUMPTION of MANUFACTURED PRODUCTS rebounded +2.1% in Q3, despite a record low -21 points Consumer Confidence Indicator, compared with a mild +0.3% the previous quarter. In September household consumption for manufactured products remained stable or +0.1% with retail sales climbing +0.6% Sales of textile-leather products performed best gaining +1.7% (compared with a -1.5% dip in August) along with household equipment +0.8% rise due to a vibrant +2.8% increase the previous month.

Source: Insee

Sales of durable goods fell -0.5% impacted by car sales dipping -2.2% following +3.1% surge in August. Q3 consumption of durable goods remained sustained however +4% compared with +1.2% in Q2. Car sales rose +2.4% (+1.3% in Q2) and household equipment purchases a strong +5.7% (+1.3% in Q2) On the same quarterly period, sales of textile-leather products rose +3.3% (-1.9% in Q2) while other manufactured products sales stayed quasi stable or +0.2% (+0.5% in Q2)

UNEMPLOYMENT stayed stable or 8.6% of the total working population according to provisional figures published by Eurostat and to be revised in December locally.

COMPANY CREATIONS - Q3 2007

Company creations performed unevenly in Q3 except in July when formations increased +5.2% compared with the previous month to 28 217 new businesses, and jumped +9.1% against the previous quarter. best performing sectors heralded a rebound of their respective activities while inversely, categories on a negative trend recorded a pause compared with hectic creations the previous month. The Education health social services new entities took the lead for company creations increasing an impressive +20.2% followed by Transport +13% rebound. Services to Companies and Services to Individuals performed similarly, recording +6% new businesses each. Consumer Goods and Construction rose equally +4% each while the Food and Agriculture Industry and Commerce new businesses rose a more modest +1.8% and +2.2% Following June record creations (+48.2%) the Capital goods sector new companies dived -20.6% and Intermediate Goods fell a slighter -1.2% for a similar reason (+33.9% in June) Real Estate new entities fell -4.4% heralding a slow down as new entities only increased +1.2% in June. In one year to July new companies rose +11.3% to a cumulative 309 461 new entities. The Food and Agriculture Industry, Intermediate Goods and Transport each recorded an impressive +20% company creations increases. Services to Individuals ranked second with new businesses rising +15.4%. Capital goods recorded +12.4% new companies increase Commerce +11.9%Construction +11% Real Estate +8.5% and Services to Companies +7.9%

In August creations rose a modest +1.7% by comparison, Five sectors maintained hectic company creations : Education-Health-Social Services new businesses rose +5% Services to Individuals +5% Construction +2.5% Commerce +1.5% and Consumer Goods +3.2% By contrast, two sectors remained on a downwards trend Capital Goods new businesses and Intermediate Goods fell each -2.6% while two other groups Transport and Services to Companies recorded a pause respectively rescinding -11.9% and a milder -0.6% The Food and Agriculture Industry new businesses recorded its first slow down, falling -2.3% while Real Estate rebounded +4% In one year to August new businesses increased +12.4% to a cumulative 312 262 new entities.In August, In one year, best performers ranked similarly to July: the Food and Agriculture Industry, Intermediate Goods and Transport each recorded impressive company creation increases respectively +23.2% +23.9% and +20.2% Services to Individuals ranked fourth with new businesses rising +15.1%. Capital Goods grew +13% Commerce +13.5% Construction +12% Education-Health Social Services +11.8% and Real Estate +8.7% Services to Companies new entities increased +8.8% September saw company formations quasi stable or +0.2% to 28 851 new businesses and +12.8% in one year to 315 450 new entities. In September, three sectors recorded strong rebounds: Transport +3.6% the Food and Agriculture Industry an impressive +4% and Capital Goods +5% The Real Estate group stayed upbeat and gained +2%. Following a hectic previous month, the Services to Individuals group new businesses fell -2.7% Construction -2% Consumer Goods -3.3% while Intermediate Goods dipped another -2.2% The Commerce sector new companies rose a slight +0.4% similarly to the Education-Health-Social Services new businesses. In one year, the Food and Agriculture Industry and Intermediate Goods recorded strong company creations respectively +23.1% and +23.5% Transport rose +21.7% Services to Individuals +15.0% and Education-Health-Social Services +13.4% Real Estate and Services to Companies new entities grew each +9.1% Construction +11.9% Capital Goods grew +7.2% In numbers and on the same period, the Commerce sector took the lead with a total 76 465 new companies followed by Services to Companies 66 575 new entities. The Construction sector 54 271 new businesses ranked third and Services to Individuals saw new companies grow to a cumulative 42 264

CONSUMER PRICES INDEX - Q3 2007 

Overall in one year, the index grew +1.2% the strongest price increases were recorded by Tobacco +5.2% rent +3.5% and other services +2.7% The most substantial price index cuts concerned oil products -3.3% due to crude oil prices per barrel down at USD 70 fresh produce -1.7% and health products -1.5%

Source: Insee 

In September, the INDEX gained +0.1% compared with the previous month but rose +1.5% in one year (+1.4% according to Eurostat HICP's). The Food index increased +0.5% impacted by the fresh produce steep +3.2% increase (-3.9% in August) The Manufactured products index grew +0.6% as clothing and shoes prices jumped +4.6% The rent index gained +0.3% as in the previous month. The Energy products price index increased +0.6% (-0.5% the previous month) as the oil products price index rose +0.8% (-1.1% in August) In one year, the strongest price increases were recorded by Tobacco +6.2% rent +3.5% and other services +2.7% The only price index cuts concerned health care products -1.4% In one year, the strongest price increases were recorded by Tobacco +6.2% rent +3.5% and other services +2.7% The only price index cuts concerned health care products -1.4%

CEREAL CROPS output forecasts in FRANCE, except corn, remained low as bad weather conditions which included heavy rains since May affected harvesting, according to the ONIGC report. The European Commission proposed plans to reduce the compulsory set aside sowings rate from 10% to 0% as a first step towards reducing record cereals trading prices. Reducing the set-aside rate from 10% to 0% is expected to increase output by at least 10 million tonnes. FRANCE’s soft wheat production for the 2007 harvest was expected at 32.28Mt, or -1Mt compared with 2006. Hard wheat output was expected at 2.06Mt, down -50.000Mt, while barley 9.76Mt forecast was likely to impact exports downwards -3.3Mt to the EU. Corn harvesting forecast was slightly up to 12.72 Mt. As worldwide demand remained high, French wheat prices mirrored international exchanges and traded at € 300/t in September and € 200/t in July. French Channel wheat prices jumped to USD410/t September 5^th and USD 383/t fob on September 7^th. Penalized by the Euro-USD parity (down -9% in one year) French prices were expected up due to the general upward trading trend. In Germany, wheat prices traded similarly to France’s. In Europe, soft wheat output estimates were expected down 3% to 114.5Mt compared with 117.Mt last year. Continental Europe was impacted the most by heavy rains while Eastern Europe drought and heat waves reduced soft wheat harvesting drastically: -44% in Romania, -35% in Bulgaria, and -17% in Hungary. By contrast good weather conditions in Spain led to positive outlook with soft wheat production forecast up 5Mt. Poland and the Baltic sea states, along with Sweden and Finland also forecasted increase in output. Hard wheat output forecast was down -8% in Europe compared with last year. Greece’s estimate output was down -17% along with Italy -11% Spain -4.3% and France -2% Barley output forecast in Europe was expected to increase mildly +3% to 58Mt. Between 1996 and 2006 worldwide, excluding Europe, fields of wheat were reduced to 208Mha from 231Mha (or -28Mha) leaving output to decline -60Mt

INDUSTRIAL OUTPUT INDEX - Q3 2007 

The Industrial Output Index increased +1.1% in Q3 impacted by all sectors’ sustained activities with the exception of the Food and Agriculture Industry -1.2% first dip which initiated its downward trend from last quarter. The Euro area industrial output rose +1.6% and in the EU 27 +1.4% FRANCE’s automobile industry production index picked up and rose +1.5% pushed up by strong export figures (see turnover exports Q2), consumer goods grew +1.1% capital goods increased +2.4% and intermediate goods a milder +0.4% Capacity utilization at 86.4 reached its highest level on this quarterly period, compared with the Euro area’s 84.3

Source: Insee 

July recorded the strongest production month with output rebounding+1.3% pushed up by the Automobile Industry +4.7% surge, Intermediate goods +1.7% increase and Capital goods +1% gain. Consumer goods production stayed quasi stable or -0.1% although household equipment output rose +1.9% and clothing leather +1.3% The Food and Agriculture Industry production remained unchanged. Energy production rose +0.6% and Construction +0.4% Mineral products out of the Intermediate goods group rose +1% while the Consumer goods sector recorded strong production increases with household equipment +1.7% increase and perfumes-pharmaceuticals-personal care products +1.8% gain. In September, and with intra-EU commerce slowing down overall, FRANCE’s Industrial output initiated a general downward trend : the Food and Agriculture industry rescinded -1.6% Consumer Goods -1.2% the Automobile Industry production index dived -3.1% Capital goods and Intermediate goods fell each -1%

In the Euro area and that same month, total industrial production fell -0.7% with Durable Consumer Goods dipping -3.4% Intermediate Goods -1.3% and Non Durable Consumer Goods -1.2% In the EU 27, total output declined -0.5% as Durable Consumer Goods production rescinded -2.6% to a lesser extent than in the Euro area, and Non Durable Consumer Goods -0.8% The strongest output index increases involved Slovakia’s +5.4% Romania’s +3% and the Netherlands’ +2.8% while Ireland and Lithuania recorded the hardest fall, respectively -4% and -10.6% In one year, FRANCE’s overall industrial output increased +1.3% impacted upwards by consumer goods +2.1% similarly with capital goods. The Intermediate goods production index grew +2% unlike the automobile industry -1.2% dip. The Food and Agriculture Industry output index declined -0.3% Energy rose +0.7% Out of capital goods the mechanical equipment component production index gained +5.1% increasing the fastest.

In the Euro area, total industrial output rose +3.5% and in the EU 27 +3.1% Capital Goods production rose the fastest +5.5% followed by Energy +3.6% Out of East European member states, Lithuania’s -0.8% accounted for the only production dip. Latvia’s +0.5% recorded the mildest production index increase, unlike Slovakia’s +15.3% despite its recent output gap.

TURNOVER INDICES - Q3 2007 

Local turnovers stayed on the increase in Q3 pushed up by three major industrial sectors and thus outperforming export turnovers : the Automobile Industry local turnover index grew +4% Capital Goods jumped +11.9% and the Food and Agriculture Indystry +2.8% Intermediate Goods local turnover index, despite the auto industry strong performance, fell -1.8%, and Consumer Goods -0.5%

Source: Insee

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