The French manufacturing sector’s strong 2017 continued midway through the final quarter of the year.
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Indeed, November saw output growth accelerate to a multi-year high, driven by strong client demand in both domestic and foreign markets.
This, in turn, encouraged firms to expand their purchasing activity and take on new workers at one of the sharpest rates in the series history.
Meanwhile, higher raw material prices led to further inflationary pressures.
The PMI is a composite single-figure indicator of manufacturing performance.
It is derived from indicators for new orders, output, employment, suppliers’ delivery times and stocks of purchases.
Any figure greater than 50.0 indicates overall improvement of the sector, while any reading below 50.0 indicates overall deterioration.
The IHS Markit France Manufacturing Purchasing Managers’ Index (PMI) posted 57.7 in November to signal a further improvement in the overall health of the French manufacturing sector.
Up from 56.1 in October, the index hit a seven-year high.
Business conditions improved across each of the three sub-sectors, led by intermediate goods.
Output rose to the greatest extent since April 2011 during November, and extended the current sequence of increase to 15 months.
The expansion in production was supported by a fourteenth successive rise in new business amid reports of strong client demand.
The rate of growth was the most marked since the end of 2010.
New export orders also rose in November, as manufacturers continued to benefit from robust global demand.
In response to higher new orders, firms hired additional staff members in November, thereby extending the current period of increase to 13 months.
The rate of jobs growth accelerated from the previous month and was the second-sharpest in 17 years.
Nonetheless, the amount of unfinished work continued to increase as rising demand outweighed capacity enhancements.
Moreover, the rate of backlog accumulation was the most marked since January 2010.
Manufacturers expanded their purchasing activity at the fastest pace in over six-and-a-half years in November, which in turn contributed to a fourth consecutive rise in pre-production inventories. ■