The final data confirmed a miserable month for French manufacturing. The 46.1 flash sector PMI was revised down to 45.7, now only 0.1 point above its final April mark, itself a 35-month low.

Output fell for 12 consecutive months, in large part reflecting another sharp fall in new orders. Both the domestic and overseas markets posted fresh losses and production would have declined more steeply but for the ongoing depletion of backlogs. Employment continued to rise but the rate of job creation was marginal and a 5-month low. Against this backdrop, business confidence about the year ahead deteriorated and remained subdued by historical standards.

Input costs decreased for the first time in nearly three years which in turn allowed factory gate prices to increase at the slowest rate since July 2020.

The final May results suggest that manufacturing will again be a drag on real GDP growth this quarter and the ongoing fall in demand offers little hope of any near-term recovery. Today's update puts the French ECDI at minus 42 and ECDI-P at minus 32. Both measures show that overall economic activity is falling well behind market expectations.

No revision is expected to the 46.1 flash print.

The Manufacturing Purchasing Managers' Index (PMI) provides an estimate of manufacturing business activity for the preceding month by using information obtained from a representative sector survey incorporating around 400 companies. Results are synthesised into a single index which can range between zero and 100. A reading above (below) 50 signals rising (falling) activity versus the previous month and the closer to 100 (zero) the faster is activity growing (contracting). The data are released by S&P Global.

Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By tracking economic data such as the ISM manufacturing index in the U.S. and the S&P Global PMIs elsewhere, investors will know what the economic backdrop is for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures..

The S&P Global PMI manufacturing data give a detailed look at the manufacturing sector, how busy it is and where things are headed. Since the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets. And its sub-indexes provide a picture of orders, output, employment and prices.