The French economy saw a boost in August driven by increased business activity from the Olympic Games, with a surge in the services sector counterbalancing the persistent weakness in manufacturing, according to a survey out on Thursday.

The HCOB flash purchasing managers index for France's services sector, compiled by S&P Global, reached a 27-month top of 55.0 in August, a rise from 50.1 in July and surpassing a forecast of 50.3 in a poll carried out by Reuters news agency.

The 50-mark separates growth from contraction.

France, the eurozone's second-largest economy, has been relying on the Olympic Games to enhance its modest growth rate. The country's statistics office has forecasted a 0.3 percentage point increase in growth due to the Games, which concluded earlier this month.

The flash composite PMI for August, which combined both the services and manufacturing sectors, increased to 52.7 points, a 17-month high, up from 49.1 in July.

However, S&P Global, the firm behind the survey, warned that the positive impact of the Olympics is expected to be temporary.

“Service providers will have benefited from the Olympic Games,” said Hamburg Commercial Bank economist Norman Liebke.

“The one-off nature of this boost is evident in the worsening employment situation, weaker output expectations and declining backlogs of work,” he continued.

In contrast, France's manufacturing sector continued to decline. The flash manufacturing PMI for August was 42.1, down from 44.0 in July and below the 44.4 forecasted in a Reuters poll.

“French manufacturers are still struggling with weak demand. New orders declined for yet another month and at the fastest pace since the COVID-19 pandemic. Given the decline in new export sales slowed, we can infer that the accelerated drop in total new orders was domestically driven,” Liebke added.