Banque de France survey reports December growth, forecasts January slowdown

In December, French industrial production grew at a sustained, though slightly slower, pace, ending 2025 positively.

Industry showed robust performance compared to services and construction in H2 2025. Aeronautics and electrical equipment manufacturing saw strong growth from year-end deliveries.

Agri-food also picked up due to festive orders.

Production declined in computer-electronics-optical products and wood, paper, printing.

The capacity utilisation rate stabilized at 76.7 percent, slightly below its long-term average.

Finished goods inventories were generally high, reflecting prudent risk management.

Market services grew moderately, with strong momentum in accommodation and food services, driven by foreign customers.

Publishing and advertising also improved.

Construction activity remained largely unchanged; structural works contracted due to weather, but finishing works were buoyant from renovation.

Industrial production is expected to slow significantly in January 2026, primarily due to a pause in aeronautics and limited visibility on order books amidst persistent uncertainty.

Most other industrial sectors also forecast a slowdown.

Conversely, market services activity is expected to strengthen, with optimistic expectations in publishing, rental, and engineering services.

Construction contractors forecast a sluggish January, with structural works remaining weak but finishing works boosted by renovation.

The uncertainty indicator declined slightly in December but remained high.

Selling prices were moderate in services, stable in industry, and declined in construction.

Recruitment difficulties stabilized at 16 percent.