French Business Confidence Stagnated in August as Sarkozy's Budget Looms

French business confidence was unchanged for a third straight month in August as President Nicolas Sarkozy prepared the country for the biggest budget cuts in at least two decades.

The Bank of France’s Business Sentiment Indicator for manufacturers was 101, the same as in the three previous months, the Paris-based central bank said today in a statement. That’s the same as forecast by a Bloomberg survey of five economists.

Sarkozy has pledged to trim the budget gap to 6 percent of gross domestic product next year and to 3 percent by 2013 from about 8 percent in 2010. That’s the biggest deficit reduction since at least 1991 and threatens to curb demand as France recovers from its worst recession since World War II.

To contact the reporter on this story: Mark Deen in Paris at markdeen@bloomberg.net

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