Slowdown in French manufacturing sector growth continues in March
Staff Writer |
Growth in the French manufacturing sector shifted down a gear at the end of the first quarter.
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Rates of expansion softened for new orders and new export business, which fed through to weaker rises in employment, purchasing activity and output.
That said, the pace of increase remained robust in each instance.
Meanwhile, business confidence was among the strongest since that series began in 2012.
On the price front, input price inflation remained marked, which filtered through to another rise in average selling prices.
Nevertheless, the rate of input cost inflation was much softer than in February.
The IHS Markit France Manufacturing Purchasing Managers’ Index (PMI ) posted 53.7 in March to signal an eighteenth consecutive improvement in the overall health of the French manufacturing sector.
Nevertheless, the index reading was down from 55.9 recorded in February, and consistent with the weakest pace of growth for a year.
The improvement remained broad-based across each of the three sub-sectors, led by intermediate goods.
Overall growth continued to be driven by a strong rise in new business from both domestic and foreign clients.
That said, the rate of expansion in total new orders was the weakest recorded for 13 months.
Strong client demand encouraged firms to take on additional workers for the seventeenth successive month in March.
The rate of job creation, however, eased from February.
Likewise, unfinished work continued to accumulate, but to a weaker extent than in the prior month.
Firms continued to expand their purchasing activity during March, albeit to the weakest extent since February last year.
The slowdown contributed to a fall in pre-production inventories, the first time this has been the case since July 2017.
Strong client demand combined with enhanced operating capacity led to a nineteenth consecutive rise in output.
The rate of growth, however, moderated to a one-year low, contributing to a decline in post-production inventories for the first time since last August.
Meanwhile, strong input cost inflation persisted amid frequent reports of higher raw material prices.
Average selling prices subsequently rose.
That said, the rate of cost inflation eased markedly over the month.
Finally, business confidence dipped from last month’s record high but remained robust amid expectations of strong client demand. ■