Confidence among French industry leaders has improved this month, pushing a relevant indicator to its highest level in over a year. The brighter business mood has prompted the government to declare the recession over.
France's industry morale indicator moved up in July, reaching 95 points from 93 points in June, the French statistics office INSEE announced Tuesday.
Even though the economic indicator was still lower than its long-term average of 100 points, the improvement in July marked the fourth consecutive month of gains, boosting industrial morale to its highest level in over a year, INSEE said.
The indicator's rise, as well as better growth expected for the second quarter, prompted French Finance Minister Pierre Moscovici to declare the recession to be over.
Pointing to expected growth of 0.2 percent between April and June, he told Europe 1 radio station the government was now working to transform the exit from recession into a genuine recovery.
At the beginning of 2013, France slipped into technical recession as its economic output contracted for the second quarter in a row, shrinking 0.2 percent in the first quarter after the same rate of contraction in the final three months of 2012.
Despite the prospective upswing in the second quarter, France's industrial production is still 10 per cent lower than before the financial crisis in 2008. Moreover, both INSEE and the EU Commission forecast recently that the recovery was unlikely to push full-year growth into positive territor..
Indication for that came from INSEE's broader indicator of business confidence, also released on Tuesday, which rose more timidly, edging up from 86 points to 87 points. In addition, the services indicator rose just slightly to 86 points after stagnating for four months.
uhe/tj (Reuters, AFP)