France Manufacturing Sentiment Strengthens in May

France’s manufacturing business climate index rose to 102 in May 2026, compared with expectations and April’s 100. It also marked the highest reading in four months, driven mainly by a sharp rebound in past production, which jumped to 14 from 4, while overall order books improved to -14 from -15 and foreign order books rose to -10 from -12. Finished-goods inventories eased slightly to 13 from 14, though they remained elevated. Labour market signals were broadly stable, with past workforce size unchanged at -3 and expected workforce size edging down slightly to -2. Forward-looking production sentiment remained weak, however, with general production prospects steady at -17 and personal production prospects slipping to 4 from 6. Inflation pressures intensified further, as expected selling prices rose to 22 from 20, the highest in the series, suggesting continued pricing power among manufacturers. Economic uncertainty also remained elevated at 37, unchanged from April.

France’s overall manufacturing business climate index edged up to 100 in April 2026 from 99 in March, slightly improving but still around its long-term average. Past production rebounded to 3 (vs –2 in March), while overall order books improved to –16 (vs –18), and foreign order books were stable at –13. Finished-goods inventories were unchanged at 14, remaining elevated. However, general production prospects deteriorated sharply to –18 (vs –10), marking a notable drop in forward-looking sentiment, while personal production prospects eased to 7 (vs 9). Labour conditions softened slightly, with past workforce size at –2 (vs –1) and expected workforce size slipping to –1 (vs 0). Inflation signals strengthened, as expected selling prices surged to 19 (vs 10), the highest since March 2023, indicating rising cost pressures across sectors. Economic uncertainty also jumped to 38 (vs 31), well above its long-term average, highlighting heightened business caution despite mixed activity signals.

France’s overall manufacturing business climate fell to 99 in March 2026 from 102 in February, dipping below its long-term average and the market consensus of 100. Past production dropped sharply to –4 (vs 3 in February), while overall order books weakened further to –19 (vs –17) and foreign order books fell to –14 (vs –8), highlighting declining demand. Personal production prospects eased to 8 (vs 10) and general production prospects fell further to –9 (vs –6). Finished-goods inventories rose to 14 (vs 9), reflecting slower sales, while economic uncertainty remained elevated at 31 (vs 32). Workforce balances improved slightly, with expected size turning neutral (vs –2)., and expected selling prices jumped to 9 (vs 5), signaling inflationary pressures. Sub-sector performance was uneven, with food manufacturing rebounding modestly, machinery and equipment holding steady, while transport equipment and other manufacturing remained weak.