The ultimate estimate is little modified from the preliminary studying as France’s manufacturing sector noticed a modest leap in exercise to spherical off the 2025 yr. A powerful rise in new export orders was the important thing cause in underpinning sentiment whereas employment circumstances additionally returned to progress on the month. In the meantime, output volumes additionally got here
near stabilising after November’s sharp and accelerated contraction. HCOB notes that:
“2025 closes on a surprisingly upbeat word. Enterprise circumstances in France’s manufacturing sector improved in December,
with the PMI climbing again above the expansion threshold to achieve its highest degree in three-and-a-half years. Whereas this could
not obscure the structural challenges of current years, it’s nonetheless a step in the best course. Trying forward, the sector
may gain advantage from large-scale orders in defence and aerospace, notably from overseas, as export demand has already
proven better resilience than home orders in current months. Nonetheless, persistent political instability and the ensuing
uncertainty amongst companies and households stay key headwinds for future prospects.
“After a number of months of contraction, manufacturing at French manufacturing vegetation broadly stabilised in December. Sturdy
export orders had been a key help, at the same time as strain on provide chains and cautious buyer behaviour proceed to restrict
output. Corporations have additionally been assembly orders by drawing down inventories. Buying exercise, which has been
declining since 2022, is now approaching stabilisation, probably signalling that the sector might have reached its trough
heading into subsequent yr.
“The modest enchancment in enterprise circumstances has prompted companies to boost costs once more after three consecutive months of
cuts, possible aimed toward stimulating gross sales. Enter price inflation stays subdued, offering some aid, however margin pressures will
persist if demand fails to strengthen additional.”
