European Manufacturing Grows, Except in France

The euro zone economic recovery that began in Germany has spread to some smaller members but shrinking French manufacturing is hampering a more robust rebound.

Business surveys released on Monday showed factory production in the 17-nation bloc accelerated as expected in October, getting close to August’s 26-month high, but still weak compared with historical levels.

Markit’s final Manufacturing Purchasing Managers’ Index (PMI) rose to 51.3 in October from 51.1, in line with an earlier flash reading and with the consensus forecast of economists. It hit a 26-month high of 51.4 in August.

But Germany and France, the bloc’s two biggest economies, went in opposite directions.

Germany showed activity picked up last month, with its index rising to 51.7 from 51.1. In France manufacturing activity shrank to 49.1, its 20th month below the 50 market that divides growth and contraction.

Trouble spots Spain and Italy also diverged, with both growing but the latter at a slower pace than previously.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza