French business confidence drops

25th February 2005, Comments 0 comments

PARIS, Feb 25 (AFP) - French producer prices rose by an annual 2.8 percent in January, reflecting higher costs for raw materials, while business confidence slipped this month on signs the economy was losing steam, data released Friday by the national statistics institute Insee showed.

PARIS, Feb 25 (AFP) - French producer prices rose by an annual 2.8 percent in January, reflecting higher costs for raw materials, while business confidence slipped this month on signs the economy was losing steam, data released Friday by the national statistics institute Insee showed.

Producer prices rose by 0.3 percent in January from December, halting two months of decreases, the institute said in a statement.

The increases "result essentially from price revisions from the start of the year that pass on, in part, recent rises in (the cost of) raw materials," the statement said.

Even when volatile energy and food items were stripped out, producer prices rose by 0.5 percent on the month and by 2.6 percent on an annual basis, Insee said.

Meanwhile, business confidence slipped in February by one point to an indexed 104, the institute said in a separate statement.

Survey responses by industrial leaders "bear witness to an economy that lacks dynamism," it noted.

The responses follow the absence of a "notable evolution for almost a year", the statement stressed.

Personal production perspectives had begun to fall again, which could translate into "a likely slowing of activity over the coming three months", it said.

Order books, both domestic and international, were thinning out, and stocks of finished products were growing, Insee data showed.

© AFP

Subject: French News

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