24 Nov 2022
The private sector economy in France contracted this month for the first time since February last year, as per the findings from a monthly survey, as a reduction in new orders impacted the second largest economy in the eurozone.
S&P Global's flash purchasing managers index (PMI) for the services sector in France declined to 49.4 points in November, compared to 51.7 the month before. The 50-mark separates growth from contraction.
November’s figure also fell short of the 50.6 points forecast in a poll undertaken by Reuters news agency.
In addition, the flash November PMI figure for the country’s manufacturing sector increased to 49.1 points this month from 47.2 in October. This surpassed a Reuters survey prediction of 47.0 points but remained under 50, thereby indicating a contraction.
Comprising both the manufacturing and services sectors, the flash November composite PMI figure declined to 48.8 points in November from 50.2 in October, and also stayed under the Reuters poll forecast of 49.5 points.
“Although France’s manufacturing sector has been in a downturn since the start of the second half of 2022, overall economic activity levels throughout this period had been propped up by continued growth in services. This vital support for the economy looks to have ended as service sector output fell for the first time in just over a year-and-a-half in November,” according to Joe Hayes, senior economist at S&P Global Market Intelligence.
“As a consequence, 'flash' PMI data pointed to the first reduction in French economic activity since February 2021,” the senior economist went on to add.