French business morale dipped in May, reflecting similar falls in Germany and Italy, as firms saw weaker foreign orders and remained confused about the state of the eurozone economy, official data showed.
The monthly index published by national statistics body INSEE on Thursday stood at 104 in May, down from an April figure that was revised up to 105 from 104.
"The results of the May 2004 survey reflect the continued doubts of business players over the situation for industry," INSEE said in a commentary.
The component of the index measuring the state of foreign order books fell to minus 16 in May from minus 2 in April. Firms were less optimistic over their own prospects, with the "personal outlook for production" read-out down to 10 from 12.
The monthly survey based on interviews with firms in the eurozone's second largest economy highlighted doubts over the strength and pace of a long-awaited upturn in the bloc.
"It's not really surprising given what we have seen in Germany, Italy and Belgium. People are concerned about the future," said Laure Maillard at CDC Ixis.
"Even if the first quarter growth figures were good, this shows the fragility of the situation - it's not in the bag yet," she cautioned. First-quarter growth of 0.8 percent was the strongest quarterly rate since late 2000.
In Germany, business confidence dipped for a third month in four in May, while Italian business morale also fell back after hitting a nearly two-year high in April.
Economists suggested the slump in foreign order books was linked to the recent appreciation of the euro against the dollar making euro-zone goods dearer, and to the weakness of other eurozone economies which are France's main export markets.
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