France’s private sector contracted in August for the first time since the pandemic related disruptions in early 2021, flash survey results from S&P Global showed on Wednesday.
At 49.8, the flash composite output index was down from 51.7 in July and signaled the first reduction in private sector output levels across France since February 2021.
The reading was forecast to drop to 50.8 and remain above the neutral 50.0 mark in August.
Although services activity growth continued to weaken, the overall downturn in the private sector was driven principally by the manufacturing activity.
The services Purchasing Managers’ Index dropped to a 16-month low of 51.0 from 53.2 in July. The score was forecast to ease marginally to 53.0.
At the same time, the manufacturing PMI came in at 49.0, in line with expectations. The score declined from 49.5 in July and hit the lowest in 27 months.
European economies look set for a challenging run into year-end and France is no exception, Joe Hayes, a senior economist at S&P Global Market Intelligence said. The downward trend in the France PMI may well persist now demand for goods and services is falling.
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