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France Industrial Output Growth Tops Expectations

France Industrial Output Growth Tops Expectations

Strong growth in the transport and refining sectors boosted the French manufacturing output in February, helping overall production to recover at a faster-than-expected pace.

Industrial output grew 0.7 percent in February from a month ago, when it fell 0.8 percent, the statistical office Insee said Wednesday. Production was forecast to grow 0.2 percent, following a 1.2 percent drop originally estimated for January.

Likewise, manufacturing output grew 0.8 percent, offsetting the 1.3 percent drop seen in January and also exceeded the 0.2 percent rise forecast by economists. The January figure was revised from the 1.4 percent drop reported on March 11.

The month-on-month expansion in manufacturing was underpinned by a 17 percent surge in production of coke and refined petroleum products and a 3.6 percent rise in manufacture of transport equipment. Meanwhile, declines in manufacture of food products as well as electronic products weighed on overall production.

Construction output advanced 1 percent, while mining and quarrying output gained only 0.5 percent.

During the three months ended February, output decreased slightly by 0.3 percent in the manufacturing sector and by 0.1 percent in the industry as a whole.

Today's data only show that the first quarter of the year will not be worse than the fourth quarter, Julien Manceaux, an economist at ING Bank NV said. Given the stagnation in industrial production and the bad confidence figures in service activities, the economist expects another small contraction of GDP in the first quarter.

The Purchasing Managers' survey results compiled by Markit Economics contrast with official data, indicating that the French private sector activity reached the weakest level in 48 months and added to the gloom enveloping the economy. The downturn deepened in March, highlighting weak new orders and production.

The second largest Eurozone economy is projected to grow at a very moderate 0.1 percent in the first quarter, results of a survey by Bank of France showed yesterday. The Paris-based Organization for Economic Cooperation and Development forecast 0.1 percent growth for the whole year of 2013.

by RTT Staff Writer

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