February 2023: Crisis cancelled?
The European Foundry Industry Sentiment Indicator (FISI) records a significant upward correction with a plus of 2.76 index points in February. The positive trend thus continues for the fourth consecutive month, bringing the index to a value of 105.9 points. The main driver of this encouraging momentum has recently been iron foundries. Overall, the assessment of the current business situation and expectations are brightening across all materials. Meanwhile, the latter, coming from a low base, show the strongest increase.
Although incoming orders have been declining for months, casting production remains stable due to sufficient stocks. While debates on economic policy are predominantly about large industrial corporations that are increasingly sceptical of Europe as a business location in favour of North America, the disadvantages of high energy prices will hit the European industrial sector progressively, if politicians do not bring about an effective adjustment of the framework conditions. The fact that a fatal production collapse in the manufacturing sector has so far been avoided despite dramatic cuts in the chemical industry and aluminium smelters, and that it is not to be expected to the same extent in the near future as it was in the autumn of the previous year, should nevertheless not be seen as a general all-clear.
Meanwhile the Business Climate Indicator (BCI) hold its level in February. The increase of 0.02 points brings the index to 0.72 points. Overall, the production trend of the past months was more positive than expected, while the selling price expectations for the month ahead are dropping on a high level.
The FISI – European Foundry Industry Sentiment Indicator – is the earliest available composite indicator providing information on the European foundry industry performance. It is published by CAEF the European Foundry Association every month and is based on survey responses of the European foundry industry. The CAEF members are asked to give their assessment of the current business situation in the foundry sector and their expectations for the next six months.
The BCI – Business Climate Indicator – is an indicator published by the European Commission. The BCI evaluates development conditions of the manufacturing sector in the euro area every month and uses five balances of opinion from industry survey: production trends, order books, export order books, stocks and production expectations.
Tillman van de Sand
Secretary Commission for Economics & Statistics
phone: +49 211 68 71 — 301