Can Macron’s Win Strengthen France’s Manufacturing PMI?
France’s April manufacturing PMI
According to data provided by Markit Economics, the France Manufacturing PMI (Purchasing Managers’ Index) stood at 55.1 in April 2017 compared to 53.3 in March 2017. It was in line with the initial estimate of 55.1.
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April’s manufacturing PMI was in the expansion zone and the highest level since April 2011. A PMI level above 50 indicates economic expansion, while anything below 50 indicates contraction.
Strong improvement in the France Manufacturing PMI was mainly due to the following:
- Production volume and output rose at a higher rate in April 2017 than in March 2017.
- Export orders and new orders rose at a stronger rate in April 2017.
- Employment growth showed improvement in April 2017.
Emmanuel Macron’s victory in France’s presidential election has also strengthened market performance. His proposed reforms are expected to improve investor confidence with a platform that’s pro-European Union (IEV) (EZU) and business-friendly. His proposed tax exemptions for France’s local housing may also give the economy a boost.
Performance of various ETFs in April
The iShares MSCI France (EWQ), which tracks France’s performance, rose 6.0% in April 2017. The Vanguard FTSE Europe ETF (VGK), which tracks Europe’s (IEV) (EZU) economic performance, rose 4.3% in April 2017.
In the next part of this series, we’ll analyze the manufacturing PMI for Canada in April 2017.