Bank of France business sentiment to recover in March

The BoF Business Sentiment Indicator for the manufacturing sector is likely to increase from 96 to 98 in March, thereby offsetting the unexpected drop recorded last month (from 98 to 96). 

Business confidence reached level above historical average from H2 15, when all the positives, including tax cuts, will start to have a significant impact. 

However, the remaining headwinds such as domestic policy uncertainty (reflected by the last departmental election results) and geopolitical tensions will continue to cap any improvement in business confidence in the coming months. The Bank of France will also release its first estimate of Q2 GDP growth, which is expected to be close to 0.3% qoq.