French manufacturing output contraction continues

Fresh French manufacturing data has confirmed a flash estimate and analyst predictions - the sector is shrinking again.

At 49.7, the Markit purchasing managers' index implies that the sector is contracting (any number above 50 implying expansion).

Jack Kennedy, senior economist at Markit:

French manufacturing output slipped back into contraction in August, but a broad stabilisation of new orders suggests that underlying demand is moving onto a firmer footing.

Similarly, employment was down only fractionally in the latest month following a sustained period of contraction, while purchasing activity fell at a slower pace.

Overall, the latest data suggest that the manufacturing sector is starting to hold its ground a little better having been under the cosh in recent times.