BAROMETER. Transport prices fell sharply in September, in an uncertain political and economic landscape. The market is experiencing structural overcapacity.
In France, the long period of uncertainty that began on June 9, following the dissolution of the National Assembly by President Emmanuel Macron, has finally ended. On September 5, after almost two months of waiting, President Emmanuel Macron appointed his new Prime Minister, Michel Barnier. It took about two more weeks to discover the composition of the government, but this time it's done, France has found a new crew at the helm, even if it is certain that the absence of an absolute majority in Parliament will make its work particularly difficult.
The post of Minister Delegate for Transport goes to François Durovray, who succeeds Patrice Vergriete. An appointment that was rather well received in professional circles. Recognised for his knowledge of issues in the field of passenger transport, the minister will nevertheless have to prove his interest in the issues specific to freight transport. And the least we can say is that he will have his work cut out for him. His first decisions are eagerly awaited, particularly by road carriers who are experiencing a very difficult period.
An improvement in the business climate
Despite the long period of political uncertainty and more than worrying public accounts, the French economy is not doing too badly. The Banque de France has revised its growth forecasts upwards for the French economy for 2024. According to its latest projections presented in mid-September, it is now counting on a GDP growth of 1.1% instead of 0.8% previously forecast. Similarly, the outlook for job creations seems to be a little more dynamic in 2024 (113,000 compared to 89,000 initially forecast), and the French economy would hardly destroy any more jobs next year. Finally, the unemployment rate in France should remain at 7.5%.
For the moment, we can see that the business climate in France has continued to recover in September 2024. The INSEE figures show a gain of 0.8 points, after an increase of almost three points in August thanks to the Olympic Games. The business climate index is thus approaching its level of last June (99) and its long-term average (100). This improvement is due to the recovery in the retail and wholesale sectors, while the business climate is stable in industry and services.
For the 3rd quarter as a whole, the Banque de France anticipates a significant increase in GDP. This increase “reflecting underlying growth of 0.2%, plus a positive impact of around 0.25 percentage point attributable to the Paris Olympic and Paralympic Games”. In October, according to businesses' expectations, activity should continue to progress in industry, should remain slow in market services, and should be stable in construction, according to the monthly economic survey published at the beginning of October by the Banque de France, confirming a certain optimism for the 3rd quarter.
A sharp drop in prices
In this context of economic dynamism, although moderate but higher than anticipated, one could have expected at least relative price stability on the road transport market. But the landing is brutal after two summer months boosted by the Olympic Games.
Road transport prices in France fell by 2.2% in September compared to the previous month. This is the second most severe decline of the year after that recorded in January. The renewed optimism seen in the business world this month seems to have completely evaporated upon contact with the tarmac of France's roads.
Source : Upply Freight Index
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