France’s manufacturing sector grows moderately in November

France’s manufacturing sector continues with moderate growth. Manufacturers in the country recorded an improvement in sector conditions in November, but the latest survey data showed just relatively marginal growth in four out of the five components that constitute the headline PMI.

The headline Markit France Manufacturing PMI came in at 51.7 in November, signalling additional improvement in the overall health of the French manufacturing sector. The figure was marginally down from the 51.8 reading seen in October.

Further increase in new orders supported the latest PMI figure. Foreign demand for French goods was also up in November. Furthermore, the pace of growth in new export orders was marked and the sharpest in five-and-a-half years in the midst of reports of greater demand from the oil and gas sector, noted Markit.

Manufacturing companies in France has increased their levels of production due to greater client demand for the third straight month in November. Despite this, the level of post-production inventories continued to drop, although at a fractional pace. To supplement higher production targets, companies increased their purchasing activity further in November. Also, the pace of rise was the sharpest since May 2011. Certain firms have placed their purchases directly into stock leading to the first increase in pre-production inventories in five-and-a-half years.

Staffing levels also increased as companies looked to increase operating capacity in line with higher demand. The overall pace of job creation was the sharpest in 57 months. In the meantime, input costs increased at the most rapid pace since March 2012 in the midst of reports of greater steel costs. Certain companies passed on the higher cost burden to their clients that added to the first month of charge inflation in over two-and-a-half years. However, the pace of rise was just marginal.