French manufacturing PMI shrinks again in October for the 20th consecutive month

(Reuters) – French manufacturing activity shrank for the 20th month in a row in October, and at a faster pace, as new orders saw their sharpest drop since June due to poor demand, a survey showed on Monday.

Data compiler Markit said its final purchasing managers’ index fell to 49.1 in October after climbing to 49.8 in September, just below the 50 point line dividing expansions in activity from contractions.

Export orders were the one positive note in October, rising for the third time in the past four months and at the fastest rate since May 2011.

The final reading missed an initial flash figure and the consensus forecast of analysts, which both came in at 49.4.

Production continued to fall as businesses kept using up their stocks of finished goods, while employment in the sector fell for a 20th month.

“The French manufacturing sector remained in contraction at the start of the fourth quarter, with output, new orders and employment all showing further (albeit modest) declines,” Markit economist Jack Kennedy said.

“Overall though, the data point to a sector continuing to struggle in the face of persistently weak economic conditions.”