French manufacturing output recovery slows in July

France's manufacturing output rose in July from a month earlier, but at a slower rate than in June.

Seasonally and working day-adjusted manufacturing production rose by 4.5pc in July from a month earlier. But this was slower than the 14.8pc increase in June from May. May-July output was 15.3pc below a year earlier, while manufacturing demand in July was still 7.9pc lower than in February — the last full month before the start of the country's lockdown to contain the Covid-19 pandemic.

The recovery in manufacturing demand varied widely by sector, with government measures to curb the pandemic as well as the start of the holiday season affecting some more than others.

Coke and oil refining production — which constituted around a third of French industrial gas demand in 2018 — was down by as much as 9.8pc from February and by 6.9pc from a month earlier, after it had risen by 19.1pc in June from May.

Demand in the automobile industry was also down by 20.6pc from February, but was up by 19.8pc from June. And there was a 2.3pc rise in the food and beverage sector from June, which moved almost level with the pre-Covid-19 period.

The manufacture of basic metals and fabricated metal products rose by 6.4pc on the month but remained 13.1pc below February.

French industrial gas demand slipped below average in July and has stayed below so far this month, as the resurgence of Covid-19 cases may have dampened industrial activity while warm weather has limited heating demand. Industrial consumption of 679.3 GWh/d in June had been 26.6 GWh/d above the three-year average.

The economic repercussions of the virus are expected to continue, with the possibility of a new confinement period if the rise in the number of cases continues. The OECD expects the eurozone's GDP to fall by 11.5pc this year from 2019 if a second wave of infections breaks out, and by 8.7pc otherwise, with the sharpest contractions in Spain, Italy and France. The eurozone's GDP fell by 12.7pc in the second quarter from the first quarter, with France's GDP contracting by 23.9pc, the OECD said.

By Auguste Breteau