FX.co ★ France Manufacturing Unexpectedly Returns to Contraction

In September 2025, the HCOB Flash France Manufacturing PMI decreased significantly to 48.1, down from 50.4 in August, falling short of the anticipated 50.2, as reported in preliminary estimates. This figure represents a three-month low. The Manufacturing Output Index also experienced a notable decline, reaching 45.9, marking its sharpest contraction since February. This downturn underscores a renewed frailty in the private sector, driven by lackluster domestic demand and weak export activity. Survey respondents highlighted reduced order inflows due to political uncertainty and competitive pressures, contributing to the sixteenth consecutive month of declining new business, though the contraction in export orders showed slight improvement. Despite these challenges, firms saw modest employment growth for the second consecutive month. Input inflation eased to its lowest level in five months, and for the first time since May, output prices decreased. Looking forward, business confidence experienced a slight dip, remaining below historical norms in the face of domestic political instability and uncertain consumption trends.