France's carmakers have led a return to manufacturing growth

The increase, the latest official figure from the Insee national statistics office, easily beat forecasts of a 0.4% monthly expansion.

Output in June had declined by 0.6%, raising fears that the French economy was stuttering.

Car production in July rose 4.7%, rebounding from previous falls.

On an annual basis, French industrial production rose 0.7% in the year to the end of July.

"July is a good surprise, but thank goodness, because since the beginning of the year French industry has not been very dynamic, less dynamic than the rest of the world and German industry," said analyst Philippe Brossard at Euler Hermes.