The French manufacturing sector registered in September its biggest decline since May 2020 due to a “fall in demand for manufactured goods”, according to an index published this Monday by the firm S&P Global. The PMI index fell from 50.6 points in August to 47.7 points in September, sliding below the 50 points that marks the limit between an expansion and a contraction of activity, specifies S&P Global in its statement.
The impact of rising energy prices
In addition to a weakening in demand, the approximately 400 manufacturers surveyed by the firm also reported a volume of new orders that 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 sector”.
“The survey points to an intensification of inflationary pressures in September, as companies indicated a strong increase in their costs, as a result of the increase in energy prices,” according to the press release.
Companies pessimistic for the next year
He points out that production has “declined at a rate hitherto unmatched outside of periods of crisis” and that “for the first time in more than two years, companies have been pessimistic about an increase in their activity over the next 12 months.” .
In September, the rebound in energy prices for companies “marks a worrying change in trend compared to the relaxation of cost pressures observed in recent months”, explains the economist again.
Source: BFM TV
