Based on the latest current reading, the European Foundry Industry Sentiment Indicator (FISI) is recording a decline, marking a departure from the positive trend observed in July. The index is now down 3.2 index points at 96.0, after 99.2 in the previous month.
There are no new orders
The lack of new orders is currently a key challenge for the European foundry industry. Backlogs have almost been eliminated, requiring new orders in various categories. Despite the current relative stability of raw material and scrap prices, the European foundry industry appears to be showing slight signs of slowing. Due to recent developments, there is no trend reversal in sight. High inflation rates and rising interest rates are slowing down new investments. Additionally, many foundry professionals express concerns about the future given the availability and prices of raw materials and scrap.
Faced with these challenges, the European foundry industry is committed to using adaptability and strategic planning to navigate this challenging landscape. However, it is important to note that the holidays could potentially bias the reports.
The business climate indicator (BCI) also fell in August. The decrease of 0.24 points brings the index to -0.33 points. The BCI has fallen below the 0 point threshold for the second time in a row. This represents the lowest value since November 2020. The negative BCI is due, among other things, to a more unfavorable assessment of order backlogs. In addition, the production development observed in recent months had a negative impact.
FISI and BCI
The FISI - European Foundry Industry Sentiment Indicator - is the earliest available composite indicator that provides information on the performance of the European foundry industry. It is published every month by CAEF, the European Foundry Association, and is based on surveys in the European foundry industry. CAEF members are asked to provide 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. Each month, the BCI assesses the development conditions of the Eurozone manufacturing sector, drawing on five industry opinion survey reports: production trends, order backlog, export order backlog, inventories and production expectations.
