PARIS (MNI) – Industrial new orders in France continued trending
upward in August, as gains in heavy transport equipment, the automotive
sector and other industries offset a mild pullback in demand for
electrical and IT equipment, the national statistics institute INSEE
reported on Thursday.

Taking July’s upwardly-revised 1.3% increase into account, industry
orders excluding heavy transport equipment rose an additional 0.6% in
August. In the three months to August, demand was 2.1% higher compared
to the three months to July and up 10.7% on the year.

Including the often volatile demand for heavy transport equipment,
orders were 2.8% higher on the month following July’s 9.3% decline,
revised from -11.2%. On a three-month average, demand was 6.9% lower.

Among the more heavily-weighed components of the new orders index,
the strongest gain was noted in the automotive sector, where demand
increased 1.8% after July’s 0.6% dip. Increases were also noted in the
demand for pharmaceutical items, which were up 6.2%, along with
textiles, which rose 4.2%.

Conversely, the 6.2% decline in the demand for IT equipment,
combined with the 4.6% fall in orders for electronic equipment, dragged
overall demand for machinery down 0.6% on the month.

Within the more traditional manufacturing sectors, new orders for
investment goods increased 2.7% after a sharp drop in the previous
month. Basic goods demand was up an additional 0.1%. Consumer durables
goods new orders increased 4.0% m/m, while consumer non-durables were up
by a more modest 2.6%.

Signalling difficult times for industry for the upcoming quarter,
demand for French manufactured goods fell in September at its sharpest
rate in over two years, weighed down by the ongoing Eurozone debt crisis
and weaker global economic conditions, a recent PMI survey showed.

Worsening new orders cut French industry morale to a 13-month low
just below the series’ average, INSEE reported, citing the results from
its September sentiment poll.

As French manufacturers revised down their new orders assessment,
the proportion of firms expecting production to trend upward in the near
term fell below the long-run average, reaching a 14-month low, according
to a European Commission report.

Pessimism among French industry managers continued to build in
October, with production expectations for this month reaching a
four-month low, a Bank of France survey noted last week, as respondents
downwardly revised their assessment of new order books and drew down
inventories.

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