Bosses' confidence plummets again

Warning that growth forecast will have to be cut as companies reveal falling confidence in the economy

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BUSINESS confidence in France has fallen for the second month according to a survey by statistics body Insee.

After plummeting nine points between July and September, the indicator of company bosses' fears or hopes for the future fell again between September and October, but by one point. It now sits at 95 against a long-term average of 100.

The study is important because businesses can see trends in consumer demand that are not available to the government.

Insee said confidence was well down with September's worrying downturn being maintained in October and the outlook was negative. This means the government should be looking at quickly revising downwards its growth forecast, which is still set at 1.75%.

Budget minister François Baroin has already warned that growth could be as little as 1.5%. The warning comes against the background of the plans for austerity measures to cut the public debt and increase taxation to help.

In manufacturing industry the indicator fell two points to 97 after a six-point fall in September with a one-point fall in service industry. The retail sector saw a one-point rise.

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