HCOB manufacturing PMI remains depressed in November

(Boursier.com) — Slight upward revision of the PMI HCOB index for the French manufacturing industry for November. The final index stands at 42.9, compared to 42.6 in the first estimate, and 42.8 in October, the lowest level in forty-one months. The index thus continues to signal a sharp deterioration in the situation in the French manufacturing sector. Furthermore, continuing to anticipate a drop in their activity in the next twelve months, manufacturers have again significantly reduced their workforce and continued their destocking operations, as evidenced in particular by the sharpest decline in purchasing stocks in three years and half.

Norman Liebke, economist at the Hamburg Commercial Bank, comments on the latest results of the survey: “the French manufacturing industry once again suffered from weak demand in November. High interest rates and continued operations destocking have in fact led to a sharp decline in the volume of new orders, a trend which, given the latest data from the PMI survey, is likely to continue over the coming months. Our HCOB immediate forecast model therefore suggests a contraction in the sector manufacturing by 0.7% in the fourth quarter, led mainly by the capital goods sector. Although the overall volume of new orders fell sharply again in November, the putting into production of pending orders made it possible to limit somewhat “the decline in activity. However, with production needs decreasing due to the decline in demand, French manufacturers have reduced the volume of their purchases and the level of their input stocks.”