Key facts
- French business confidence increased to 97 points in July, a four-month high.
- Confidence rose in manufacturing, services, and retail sectors.
- Manufacturing confidence reached 101, services 98, and retail 99.
- Construction confidence remained stable at 95.
- Supply-side constraints increased for 22% of firms.
French business confidence reached a four-month high in July, improving to 97 points, according to a survey by the INSEE statistics agency. This marks an increase from the previous month and indicates resilience in business sentiment despite ongoing geopolitical tensions in the Middle East and record heatwaves in France.
Confidence saw gains across key sectors. Manufacturing, France's largest sector, reported stronger output and improved order books, pushing its confidence index to 101. Services, the largest sector of the French economy, saw its confidence index rise to 98, with particular optimism noted in the hospitality sector due to strong demand expectations for the summer tourism season. Retail businesses also posted a significant gain, with their confidence indicator jumping eight points to 99, driven by stronger order intentions and a more positive outlook.
However, the survey also highlighted persistent challenges. The proportion of firms reporting supply-side constraints increased to 22%, the highest level since late 2023, attributed partly to difficulties in securing inputs. In the construction sector, confidence remained unchanged at 95, with firms expressing slightly less optimism about future activity.