French Manufacturing Sees Growth Amid Price and Supply Concerns

S&P Global Market Intelligence Chief Economist Joe Hayes noted on May 4 that French manufacturing experienced significant growth in orders and production lines in April. According to Jin10, this was driven by clients purchasing in advance due to expected price increases and supply disruptions. The increase in backlogs suggests that this positive trend could continue throughout the quarter. However, Hayes cautioned that capacity constraints could quickly lead to broader inflation issues, as seen in the past two years. During this period, French manufacturers have struggled with pricing power due to weak demand and international competition. In April, many companies absorbed rising costs, but as order books fill, passing on these costs becomes easier. From a policy-making perspective, these developments warrant close attention.