© Reuters. An employee works on the automobile assembly line of Bluecar electric city cars at Renault car maker factory in Dieppe, western France, September 1, 2015. REUTERS/Philippe Wojazer/File Photo
PARIS (Reuters) – France’s ailing manufacturing sector contracted for the eighth month in a row in September, with production and new orders falling at their sharpest rates in over three years, a survey showed on Monday.
HCOB’s final Purchasing Managers Index (PMI) for the French manufacturing sector – compiled by S&P Global – came in at 44.2 points, down from 46.0 in August but slightly better than the 43.6 points seen in a flash estimate. Readings below 50 denote contractions in activity.
“The French manufacturing sector is still stuck in the mud”, said HCOB economist Norman Liebke, adding that output levels declined in all three segments of the sector – consumer, intermediate and capital goods.
Manufacturers further reduced their purchasing activity, stock levels and recruitment in response to the weaker demand environment. Employment across the sector contracted for the fourth month in a row.
Roughly a third of surveyed executives predicted a fall in output over the coming year, according to the survey.
“Fears of spill-over effects from downturns in other parts of the economy, such as the construction sector, are also compounding manufacturers’ misery”, said Liebke.