The French manufacturing sector recorded its strongest decline in September since May 2020 (AFP/Archives/Denis Charlet)
The French manufacturing sector recorded in September its largest decline since May 2020 due to a “fall in demand for manufactured goods”, according to an index published Monday by the firm S&P Global.
The PMI index fell from 50.6 points in August to 47.7 points in September, slipping below the 50 point mark which marks the limit between an expansion and a contraction of activity, specifies S&P Global in its communicated.
In addition to a weakening of demand, the approximately 400 manufacturers questioned by the firm also reported a volume of new orders which fell “sharply”, a trend explained by “the high level of prices, as well as, according to some respondents, by the weakness of certain sectors such as the automotive industry”.
“The survey signals an intensification of inflationary pressures in September, as companies indicated a sharp increase in their costs, itself resulting from the surge in energy prices,” according to the press release.
“The latest French PMI data does not bode well for the coming months,” said Joe Hayes, economist at S&P Global Market Intelligence.
He notes that production has “declined at a rate hitherto unequaled outside of periods of crisis” and that “for the first time in more than two years, companies have expressed themselves pessimistic about an increase in their activity during the for the next 12 months”.
In September, the surge in energy prices for businesses “marks a worrying reversal of the trend compared to the easing of cost pressures observed in recent months”, explains the economist again.
© 2022 AFP
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