FX.co ★ France Manufacturing Sector Nears Stabilization

In May 2025, the HCOB France Manufacturing PMI increased to 49.8, up from April's figure of 48.7, in line with preliminary forecasts. Production levels witnessed a consecutive monthly rise, with consumer and intermediate goods manufacturers reporting increased output. Although new incoming orders saw a slight decline in May, the contraction was minimal. Significantly, employment in the sector experienced growth for the first time in two years, marking the most substantial rise since March 2023. In terms of costs, output prices decreased for the seventh instance in the last eight months, with May experiencing the sharpest drop since November 2024. This decline was partly facilitated by reduced cost pressures as input price inflation continued to ease. Consequently, manufacturers opted to reduce inventories, both before and after production stages. Concurrently, backlogs of work climbed for the first time since January 2023. Finally, business confidence reached its highest point since February 2022, fueled by new product introductions and optimistic prospects for future demand.