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Is France’s Falling Manufacturing PMI Affecting Business?

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France Manufacturing PMI in February 2018

According to data provided by Markit Economics, the final Markit France Manufacturing PMI (Purchasing Managers’ Index) was 55.9 in February compared to 58.4 in January 2018. The figure didn’t meet the preliminary market estimate of 56.1. February’s factory activity was the slowest since August 2017.

The country’s manufacturing PMI touched a 17-year high in December 2017. February’s PMI number was mainly due to the following:

  • Production volume and output rose at a slower rate in February.
  • New business orders and export orders rose at a slower pace in February.
  • Employment in the manufacturing sector and consumers’ purchasing activity rose at a softer rate in February.
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Performance of ETFs in February

The iShares MSCI France (EWQ), which tracks France’s performance, fell 5.1% in February 2018. The iShares MSCI Eurozone ETF (EZU), which tracks the performance of the Eurozone (IEV), fell 6% that month.

The sell-off in the major indexes around the globe, the panic situation among investors, the uncertainty about Italy’s national election, and the Social Democratic Party of Germany’s internal vote mainly affected consumer sentiment in February. It also affected new orders and, hence, the business condition.

In the next part of this series, we’ll analyze the Germany Manufacturing PMI for February 2018.

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